USDJPY Trade Setup Analysis – 13th October

USDJPY Trade Setup Analysis – 13th October On Monday 13th October we’ll be looking closely at USD/JPY at it heads into the new week on the back foot. Following a sharp Friday reversal, sliding from fresh cycle highs near 152.8 – 153.0 to close around 151.15. The macro impulse flipped tactically yen-supportive: risk assets wobbled on renewed U.S. / China tariff escalation while UST yields fell, compressing the UST – JGB spread that had been powering the move higher. Japan’s MoF also intensified its “one-sided, rapid moves” rhetoric, still verbal for now. This was enough to dampen momentum and incentivize short-covering in JPY at the margins. Against that backdrop, the near-term balance of risks leans to corrective downside despite the medium-term policy divergence that still favors the dollar. Technically, the pair posted a textbook failed breakout: rejection above the 152.8 / 153.0 supply band turned that zone into first resistance, with a clean pivot lower through intraday trend support. The 151.2 / 151.0 shelf is now the pivotal battleground; below it, air pockets open toward 150.8 and 150.2. Flow-wise, dealer/stop interest is likely layered under 151.2 / 151.0 and again top-side above 152.8 / 153.0, classic big-figure clustering that can amplify moves around the Tokyo open. USDJPY Trade Setup Analysis: Pair / Asset Bias & Entries Stop / Invalidation Targets Why A+ (fundamentals, technicals, sentiment/positioning) Near-term catalysts (UK time) USD/JPY SHORT rallies 152.10 – 152.90; add if spike toward 153.20 153.60 (H4 swing high & round-up trap) 151.20 – 150.20 (stretch 149.20) Fundamentals: Risk-off from tariff shock & Gaza ceasefire relief has shifted flows into USTs 10y yield down 9bp w/w to 4.05%, softening USD carry; Japan MoF repeatedly warns on “rapid” FX moves (headline risk to upside spikes but net JPY-supportive). Technicals: Rejected 153.00 area; rising-wedge break on intraday; heavy offers above 152.5. Sentiment: Leverage funds were heavily short JPY earlier in the year; with CFTC updates paused by the shutdown, asymmetry is toward short-covering when UST yields dip / MoF jawbones. Stops likely above 153.50. Mon–Fri 00:30 – 03:00 MoF/Kanda/Kato wires (verbal intervention window). Wed 16 Oct 07:00 UK GDP (risk via GBP/JPY correlation). Thu 16 Oct 13:30 US PPI (may slip due to shutdown); Fri 24 Oct 13:30 US CPI (rescheduled). BoJ – MPM 29–30 Oct. Tariffs / risk: The U.S. announced plans for 100% tariffs on China (effective as soon as Nov 1), shattering risk appetite and knocking yields/dollar lower into the Friday close. Equities had their worst day since April. That backdrop boosts JPY and CHF and pressures USD/JPY. Chart by TradingView – USDJPY Trade Setup Analysis – 13th October 2025 Conclusion: While prices holds below 152.5 – 153.0, we prefer a sell-the-rallies stance, leaning into 152.1 – 152.9 and adding on sustained breaks below 151.2, targeting 151.2 – 150.2 (stretch 149.2). The trade thesis is invalidated on a 4-hour close back above 152.85 (failed breakdown) or a daily close >153.6, which would re-ignite topside momentum. We’ll be looking to manage short positions dynamically, taking partial profits into the 151.2 / 150.8 magnets, trail stops above successive lower highs, and be alert to headline risk: any MoF shift from words to action, or a sudden rebound in UST yields/risk sentiment, can compress the window for downside follow-through. Absent that, the combination of macro tone, technical failure at 153.00, and stop/option gravity under 151.0 keeps the risk-reward skewed lower to start the week. For similar Forex Trade Signals please visit our forex 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. 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