USD/JPY Plunges as Safe-Haven Demand Eases Post-Geopolitical Tensions

USD/JPY has experienced a sharp decline as safe-haven flows that previously supported the dollar unwind following the de-escalation of geopolitical tensions. The pair has broken below key technical levels, with traders repositioning as risk appetite returns to markets. The Japanese yen, traditionally a safe-haven currency alongside the dollar, is now benefiting from unwinding of war-related hedges that had pushed USD/JPY higher. Market participants are also eyeing the Bank of Japan's increasingly hawkish stance compared to potential Federal Reserve rate cuts in 2025. Technical indicators suggest further downside momentum, with the pair breaking below its 50-day moving average. The move also reflects broader dollar weakness across the board, with the Dollar Index futures showing corresponding declines. Traders should monitor the 145.00 psychological support level, while resistance now sits at the previous support zone around 147.50.