USD/JPY rallies as traders eye US tariff developments

USD/JPY has extended its bullish momentum, pushing higher as market participants closely monitor potential US tariff policy announcements. The pair has gained strength amid risk-on sentiment and expectations of hawkish US trade measures that could boost dollar demand. Japanese yen weakness persists as the Bank of Japan maintains its ultra-loose monetary policy stance, creating a widening interest rate differential with the Federal Reserve. Technical indicators suggest continued upward pressure, with the pair breaking above key resistance levels. Immediate resistance sits at the recent highs, while support has formed at previous resistance zones turned support. The ongoing divergence between US and Japanese monetary policies continues to favor USD strength. Traders should watch for any concrete tariff announcements from US officials, which could trigger additional volatility and potentially accelerate the pair's upward trajectory if protectionist measures are confirmed.