Created on September 15, 2026

The US dollar continues to see noisy trading against the Japanese yen as we start the week.

USD/JPY

The U.S. dollar has rallied just a touch during the trading session on Monday as we continue to build a little bit of a basing pattern against the Japanese yen.

This is very interesting because the 10-year yield in the United States has just broken above the 5% level, and that is going to influence a lot of things at the same time. The Bank of Japan does have an interest rate decision on Thursday, expected to be a hike. The Federal Reserve is expected to hike on Wednesday, so it’s more or less a wash.

I think where we go next comes down to the perceived speech

How traders look at the speech in the press conference after these central bank decisions will determine what the forward path is. As things stand right now, the bond market is suggesting more rate hikes in America are coming, and I think a lot of traders are starting to come around to that realization.

Now, the Bank of Japan has intervened multiple times, but all that’s done is offer U.S. dollars at a discount. They will find that the market is bigger than what they can control. The best they can do is slow things down. Generally speaking, they will need the Federal Reserve to bail them out to fight this for the longer term.

The question at this point is, does the ¥153 level hold as support? So far, it looks like it’s trying to. The other question is, can we break above the ¥156 level? Because if we can, that could be the beginning of something somewhat significant.

I do believe that the interest rate differential continues to be a major issue here. If that’s going to be the case, we’ve got a scenario where traders continue to look at the U.S. dollar with interest, especially as we are in the oversold part of the stochastic oscillator and starting to see momentum to the upside while interest rates continue to climb.

Want to trade our USD/JPY forex analysis and predictions? Here’s a list of forex brokers in Japan to check out.

Christopher Lewis is a technical analyst and market commentator at DailyForex with more than two decades of trading experience in Forex and other leveraged markets. Based in Columbus, Ohio, he specializes in chart-based analysis of major currency pairs, stock indices, commodities, and energy markets, focusing on clear support and resistance levels, trend structure, and risk management. Christopher produces daily written and video analysis for traders who rely on technical setups to navigate volatile market conditions

As seen on: Pairs Of Aces Podcast,The Trader Guy, FXEmpire