USD/JPY Reclaims 157. Can the Rebound Last?

USD/JPY has bounced back above 157 after sliding to 157.11, its lowest level in about three weeks.

The rebound comes after a sharp move lower in the yen pair, as falling US Treasury yields and stronger demand for safe-haven currencies put pressure on the dollar. Expectations for further Bank of Japan tightening have also given the yen some support.

For now, 157 is the level to watch. If USD/JPY can hold above it, the pair could attempt a move back toward 158. A break back below 157, however, would keep the recent low at 157.11 in focus.

The bigger test is coming next week, with the Fed meeting on October 28 followed by the Bank of Japan meeting on October 29–30. Any shift in expectations for the US-Japan rate gap could quickly give USD/JPY a new direction.

For now, the pair is bouncing — but it is too early to call it a reversal.