USD/JPY Rejects 160.00 as Japan Intervention Risk Returns

By Grace Kim

ThinkMarkets reports that USD/JPY reached 160.188 on Wednesday, up 2.53 yen from Tuesday’s low of 157.658, before retreating to 159.90, just below 160.00.

The pair’s 18:00 candle closed at 159.552, according to ThinkMarkets, after USD/JPY broke above 158.59-158.97. ThinkMarkets says that zone capped the pair in mid-October and several times in early November after a month of stalled rallies.

Where does the breakout have support?

ThinkMarkets now treats former resistance at 158.59-158.97 as a potential support zone. It places the 38.2% retracement of the three-week rally at 158.613, near the zone’s lower edge.

Nearer the current price, ThinkMarkets identifies a two-day consolidation floor at 159.295-159.529. The 23.6% retracement at 159.215 sits just below that floor.

The chart’s rising trendline has made eight points of contact since Tuesday, according to ThinkMarkets. It rises about 0.59 yen a day and passes near 159.74 at the current candle.

ThinkMarkets says those levels together define the support structure beneath the breakout.

Takeaway: ThinkMarkets’ chart keeps 159.295 as the first downside test and 158.59 as deeper support.

Why has USD/JPY failed to hold 160.00?

Since Thursday evening, three completed four-hour candles have traded above 160.00, reaching 160.04, 160.024 and 160.188, according to ThinkMarkets. Each closed back below 160.00. The current candle reached 160.058 and is trading below 160.00 again.

ThinkMarkets’ chart contains no historical reference above 160.188. If USD/JPY breaks that high, its analysis says round numbers become the next reference points.

RSI peaked at 74.15 on Wednesday night and has spent eight of the last 15 candles above 70, ThinkMarkets reports. It stood at 70.09, just below its 70.42 average.

ThinkMarkets calls the decline an early sign of easing momentum as the pair stalls below 160.00. RSI can remain overbought for an extended period in a strong trend, according to ThinkMarkets. It says easing momentum plus repeated closes below resistance is consistent with consolidation.

Takeaway: ThinkMarkets reads the overbought momentum and failed closes as consolidation, not a confirmed continuation.

What would confirm the next move?

ThinkMarkets frames the next moves through four-hour closes, rather than intraday breaches.

• A close above 160.188 would extend the breakout beyond the chart’s highs. A subsequent hold above 160.00-160.188 would establish that zone as support, with round numbers providing the next references.
• A close below 159.295 would break the consolidation floor and put USD/JPY below the rising trendline, currently near 159.74. The 23.6% retracement at 159.215 would be next support, before a potential retest of 158.59-158.97, which contains the 38.2% retracement at 158.613.
• Between those thresholds, ThinkMarkets describes a potential continuation flag below 160.00.

Takeaway: ThinkMarkets’ thresholds separate a confirmed breakout from a close below the 159.295 floor.

How large is Japan’s intervention risk?

CME FedWatch, as cited by FxWirePro on November 12, showed markets pricing a December Federal Reserve rate hike as a near-certainty after the stronger-than-expected October inflation reading.

FxWirePro reported on November 12 that Japan’s top currency diplomat, Atsushi Mimura, warned on Thursday it was “too early to forget the summer’s intervention.”

FXStreet’s November 13 report described Prime Minister Takaichi’s warning that morning as “an explicit intervention warning” as USD/JPY backed away from 160.00.

Japan’s Ministry of Finance records, published November 9, show that Japan spent 15.4 trillion yen across three sessions between July 30 and August 3.

Coinpaper, citing Japan MoF records on November 12, described the action as the first coordinated action with Washington since 1998. It pulled USD/JPY toward 155 after the pair traded near 164.

Japanese authorities have never identified 160 as an automatic intervention trigger, ThinkMarkets says. Its three failed attempts to close above 160.00 are consistent with caution around that level as markets weigh U.S. rate expectations against intervention risk.

Takeaway: Japan spent 15.4 trillion yen in July and August, but 160.00 remains a risk zone, not an official trigger.

What risks frame the trading setup?

ThinkMarkets says the analysis is general market commentary, not investment advice, and that it will not accept liability for any loss or damage, including lost profit, arising directly or indirectly from use of or reliance on it. It also warns that CFDs are complex, highly leveraged instruments that can lose money rapidly.

Takeaway: ThinkMarkets’ technical map does not remove the rapid-loss risk attached to leveraged CFDs.

Under ThinkMarkets’ framework, the next four-hour close—above 160.188 or below 159.295—will determine whether the breakout extends or gives way as Japanese authorities weigh intervention.