USD/JPY Near 160: Breakout or Intervention Risk?

The US dollar and USD/JPY broke higher at the start of the week after geopolitical tensions increased. USD/JPY remains a key driver of the broader dollar index, and its moves often spill over into EUR/USD and GBP/USD.

However, USD/JPY is now close to the 160.00 level, which has previously triggered warnings of intervention from Japanese officials. Chasing USD/JPY higher near 160.00 offers weaker risk reward. Similar sharp pullbacks happened in late January and again in February when the pair was near its highs.

Technically, in the US dollar, it’s the prior resistance from the ascending triangle that is now potential support.

DXY Daily Chart

For USD/JPY, 156.27 is near-term support. Below that, 154.45 to 155.00 is a key zone with many past reactions. If that area fails, 153.67 is next, followed by a major support and possible invalidation zone between 151.95 and 152.50, which has already held two strong sell-offs this year.

USD/JPY Daily Chart

In short, the dollar has bullish momentum, but USD/JPY is testing a very sensitive area near 160.00. Upside is possible, but the risk of intervention or a sharp pullback is rising.