This Week's Market - July 7, 2026 (Tuesday)

This Week's Market - Tuesday, July 7, 2026

Following the closure of positions ahead of the 3-day weekend in the U.S. on July 3rd and the subsequent employment statistics released on the 4th, USD/JPY temporarily dropped to the 160 range. However, it has since rebounded and returned to the 162 range.

With recent remarks from LDP President Takaichi that could be interpreted as a warning against interest rate hikes, a scenario towards 165 has emerged without government intervention. Major market predictions are increasingly leaning toward a continuation of yen depreciation, as evidenced by Goldman Sachs revising its 1-year forecast upward from 155 to 165.

The upcoming FOMC minutes are expected to provide clearer direction on the dollar's outlook. If the environment favors an increase in current dollar interest rates, USD/JPY will likely continue its upward trend toward a weaker yen.

Nevertheless, vigilance regarding potential market intervention will likely persist this week. Therefore, I am considering setting short positions just below 161.50.

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