This note via eFX:Synopsis:HSBC's multiverse modeling sees USD/JPY fairly valued within a 146–152 range, but warns that a number of political, macroeconomic, and policy shifts could trigger a JPY rebound. Key among these are a US-Japan trade deal, renewed Fed easing, or direct Japanese FX intervention.Key Points:Model-Implied Range for USD/JPY:HSBC's multiverse model shows a current fair-value band of 146–152, based on data as of July 8.The modeled range has moved sideways in recent months, reflecting broad uncertainty.Reversal Catalysts for JPY Strength:A US-Japan trade deal with lower-than-expected tariffs could ease fiscal concerns and revive BoJ rate hike expectations.Undervaluation of the yen: JPY REER is ~10–35% below historical averages depending on timeframe, pointing to upside potential.BoJ lifers are under-hedged, increasing potential for JPY appreciation if sentiment turns.Other Downside Risks for USD/JPY:Fed rate cuts (HSBC still expects one in September).A global risk-off event or a sharp US slowdown.Renewed doubt about Fed independence, particularly amid US political noise.MoF FX Intervention:HSBC notes a possible “line in the sand” at 155–160, with past intervention and hawkish BoJ signals capping USD/JPY.This intervention threshold may have shifted lower due to U.S. scrutiny over currency manipulation.Conclusion:While HSBC sees USD/JPY as fairly valued between 146–152, the pair is vulnerable to a reversal from several angles—especially trade diplomacy, Fed policy, and potential MoF intervention. Further upside is possible but not without growing policy and valuation constraints.For bank trade ideas, check out eFX Plus.Visit investingLive.com (formerly ForexLive.com) for additional, original views. This article was written by Eamonn Sheridan at investinglive.com.