Created on October 21, 2025

The U.S. dollar strengthened sharply against the yen on Monday, rebounding from ¥150 support with a bullish hammer formation. Analysts expect continued upside toward ¥153, supported by yield differentials, while pullbacks remain buying opportunities above ¥147.

• The U.S. dollar has rallied significantly during the trading session on Monday against the Japanese yen, kicking off perhaps the next leg higher as the ¥150 level has often offered a bit of support, with the Friday candlestick showing itself as a hammer.
• The hammer, of course, is a very bullish sign, and therefore I think you have to look at this as a market that is probably trying to reach towards the ¥153 level.
• If we break down below the hammer from the Friday session, then we start to look at the 50-day EMA, which is an indicator that a lot of people will be watching. And there’s a gap underneath there that is supported by the 200-day EMA.

Ultimately, this is a market that I think continues to see a lot of upward trajectory, mainly due to the fact that the interest rate differential continues to favor the U.S. dollar. And I just don’t see how that changes anytime soon. Ultimately, this is a market that has been breaking out for a while.

I Collect Swap When I Can

And as you get paid at the end of the day, if you’ve been watching me for several months, all the way back to somewhere in June, I think I have started to tout the strength of the idea of being long in this market, and I have been long in this market for quite some time.

At this point, it’s going to be more of a grind to the upside than anything else, but you get paid to wait, and I think that’s a huge advantage. If we were to break down below the ¥147 level, then okay, things change. But until then, this looks like a market where short-term dips offer the possibility of buying opportunities to take advantage of as market participants continue to shun the Japanese yen for a whole host of economic reasons in that country.

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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.