$USDJPY As mentioned, unless we see the Strait return to normal and/or a BOJ rate hike, USDJPY should break above 160. Yen has weakened back above 160 and is now approaching the recent high that triggered MOF intervention in late April.

The 160 area is the danger zone. The recent pullback in oil lowers one source of pressure on yen weakness, but rate differentials remain wide and could widen further. BOJ normalization is already largely priced in, so unless Japan delivers a real hawkish surprise, intervention alone is more likely to smooth volatility than reverse the trend.

USDJPY has seen intervention-driven pullbacks before, but the broader trend remained tied to rate differentials, dollar strength, and positioning. This setup is different from 2024, when BOJ hikes, MOF intervention, weak U.S. data, and broad dollar weakness all hit at once.

Next week's FOMC is critical. If the Fed hikes while the BOJ holds, USDJPY should face further upside pressure. On the other hand, a BOJ hike or another aggressive MOF intervention could quickly suppress the pair.