USD/JPY Rally Triggers Fresh Intervention Watch as Holiday Liquidity Slims

USD/JPY scored its strongest weekly gain since October 2025 amid a hawkish shift in U.S. rate expectations and a hawkish-but-dovish Bank of Japan narrative, with front‑end yields lifting the dollar and a near-0.98 correlation to U.S. 2-year yields. Yet the rebound raises renewed intervention risk as Japan enters a five-day holiday with thin liquidity and a suspected rate check around 158; traders will monitor Fed speakers (notably Williams) and energy prices for cues. Key levels to watch include resistance near 158 (with 158.41/159.07 nearby) and support down to 156.68, 155.50–155, and 152.90, while a record net long yen position suggests risk may shift toward balance rather than a clear directional move.