Dollar Nears 160 Against Yen as Euro and Aussie Find Room to Push Back

SDSDThe US Dollar is still holding firm, but the picture is becoming less one-sided across the major currency pairs.

USD/JPY traded near 159.50 on Tuesday after briefly approaching 160.00, putting the pair back at levels not seen since Japan and the US intervened in the market at the end of July.

That episode is still fresh in traders' minds. The intervention sent USD/JPY down nearly 900 pips in just two sessions, from below 164.00 to around 155.00.

With the pair once again close to 160.00, the market is naturally watching the level closely. Another approach toward 160 could bring renewed attention from Japanese officials, particularly if the yen continues to weaken quickly.

EUR/USD is telling a different story.

The pair is holding around 1.1580 after softer US inflation data reduced expectations for tighter Fed policy. The dollar has lost some ground against the euro, although the move remains relatively measured.

The technical picture is still constructive. EUR/USD is trading above its 100-day SMA near 1.1570, while the RSI is around 63, suggesting bullish momentum without pushing into overbought territory.

A move through the 1.1650 area would put the upper Bollinger Band in focus. On the downside, 1.1570 is the first level to watch, followed by the 1.1505 area.

The Aussie is caught somewhere in between.

AUD/USD climbed as high as 0.7119 before easing back toward 0.7080. The pair is being pulled in different directions as uncertainty around the Middle East keeps energy prices elevated, while higher energy costs could make the inflation outlook more

complicated for central banks.

That leaves the major currencies with very different stories.

The yen is dealing with intervention risk as USD/JPY approaches 160. The euro is benefiting from softer US inflation and a less hawkish Fed outlook, while the Aussie remains sensitive to commodities and geopolitical developments.

For traders, the broader dollar trend may be less important than how each pair responds to its own pressure points. 160.00 on USD/JPY, 1.1650 on EUR/USD and 0.7120 on AUD/USD are the levels worth keeping on the radar.