USDJPY Trade Setup – 9th Feb

USDJPY opens the week at an inflection point, with price action increasingly sensitive to the two forces that matter most for this pair: US yield direction and Japan-specific policy risk. The backdrop remains unusually “headline-reactive” for yen crosses—where sudden spikes can be driven by shifting rate expectations, risk sentiment, or renewed attention on Japan’s FX policy posture. Against that backdrop, the market is also weighing whether the latest moves in the dollar and Treasury yields are sustainable or vulnerable to another reversal as the week’s macro calendar gathers pace. Today’s plan focuses on trading USDJPY with a clear framework: identify the zones where liquidity is likely to concentrate, respect the level where the thesis is invalidated, and avoid getting chopped by noise around event risk. USDJPY Trade Setup: Pair Bias & Entries Stop / Invalidation Targets Why A+ (Fundamentals, Technicals, Sentiment) Price Action Driver Near-term catalysts (UK time) USDJPY SHORT – Sell rallies into 156.80–157.20 (or sell failure to reclaim 157.00 after a spike) Above 158.00 (daily reclaim / “intervention risk” fades + USD squeeze) 155.50, then 154.80 (stretch: 154.20 if risk-off hits) Fundamentals: JPY supported by elevated intervention risk and post-election policy repricing in Japan; USD side capped by softer DXY tone. Technicals: Lower-high / sell-the-rip structure with clear invalidation above 158. Sentiment: Crowded USDJPY longs typically get nervous when intervention chatter rises → asymmetric downside on failed pops. Japan FX intervention risk + US yields (and overall USD tone) US Business Inventories (15:00); Fed Waller/Bostic (evening); Treasury bill auctions (later). (Newsquawk) USDJPY Trade Setup – 9th Feb Conclusion For today, the highest-quality USD/JPY opportunity comes from treating the pair as a rates-led, event-sensitive instrument and letting the structure dictate execution. The objective is to engage only where the setup offers true asymmetry, defined entries around well-known liquidity pools, a clean invalidation point, and realistic targets that align with how USDJPY typically responds when momentum flips. Keep the driver dashboard front and center: US10Y (and real yield impulses) for continuation, DXY for broader USD tone, and Japan policy/intervention sensitivity as the wildcard that can accelerate moves without warning. If yields re-accelerate and USD regains traction, expect sharper squeezes; if yields stall and risk sentiment turns, pullbacks can extend quickly. In short: stay selective, size appropriately for headline risk, and let the market confirm before committing, USDJPY can be generous when the driver aligns, and unforgiving when it doesn’t. This analysis is for informational purposes only and does not constitute investment advice. Trading involves risk; manage exposure accordingly. For similar FX Trade Setups please visit our FX Trade Ideas page. Please visit our Disclaimer page. Disclaimer Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. TerraBullMarkets.com does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets or any financial instrument involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of TerraBullMarkets.com nor any of its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page. TerraBullMarkets.com and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. TerraBullMarkets.com and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted. The author and TerraBullMarkets.com are not registered investment advisors and nothing in this article is intended to be investment advice. TerraBullMarkets...