USDJPY climbs on Takaichi stimulus expectation, a cautious BoJ, US Dollar/Japanese YenFX:USDJPYKrisadaYoonaisilUSDJPY climbs on Takaichi stimulus expectation, a cautious BoJ, and firm US yields. Technical Analysis USDJPY continues to surge, breaking above the previous high, which indicates the uptrend. The upward momentum is strengthening, evidenced by the bullish EMAs and higher swings. The upside target is at 155.00, measured by the flagpole pattern projection. If USDJPY maintains its upward momentum, it could reach the 155.00 target, or it might consolidate sideways before rallying further. However, if the price pulls back before continuing its advance, USDJPY could retrace to test the support at 150.90 before resuming its uptrend. Fundamental Analysis Fundamentally, USDJPY's rise is primarily driven by Japanese politics. Sanae Takaichi's election as the LDP party leader has led the market to expect stimulus policies and a continuation of the previous monetary easing approach (Abenomics). The market believes Takaichi will support economic stimulus and delay the BoJ's interest rate hikes. The BoJ remains cautious about raising interest rates, as long-term inflation data trends below its 2% target. Investors see a lower probability of a rate hike by the end of the year, especially with new PM, which is keeping the yen weak. Demand for the USD, driven by higher US bond yields, continues to provide long-term support. Going forward, the outlook for USDJPY will primarily depend on the BoJ's stance and the Japanese government's policies, while the Yen carry trade will also continue to be a key factor. Analysis by: Krisada Yoonaisil, Financial Markets Strategist at Exness