• USD/JPY edged lower on Friday as the yen gained on remarks from the Finance Minister about possible currency intervention.
• Finance Minister Satsuki Katayama warned on Friday that Japan could intervene in the currency market to address excessive volatility and speculative pressures on the yen.
• The comments mark a step up from policymakers, who until Thursday had expressed concern over one-sided, rapid yen movements and said they were monitoring the market with a high sense of urgency.
•Japanese policymakers have struggled with the weak yen, as it drives up import costs and raises household living expenses.
• Japan last intervened in the currency market in July 2024, after the yen dropped to a 38-year low near 161.96 per dollar, following warnings from authorities about taking “decisive action” before entering the market.
• Immediate resistance is located at 157.75 (23.6%fib), any close above will push the pair towards 158.00 (Psychological level).
• Support is seen at 156.89 (Nov 20th low) and break below could take the pair towards 155.58 (38.2%fib)
Recommendation: Be on sidelines
