The wave of yen depreciation is surging, with the USD/JPY approaching 159.45, hitting an 18-month low. The market is widely watching the 162 technical level—once broken, option stop-loss triggers could push the exchange rate toward 170.

Hedge funds' betting stance is clear: trading volume of bullish USD options exceeds that of bearish options by more than twice, and reverse knock-out options are targeting a yen depreciation to 165. In comparison, verbal warnings from Japanese authorities have limited effect. Although the Finance Minister claimed "no measures are ruled out," market participants have already provided the answer.

The deeper issue lies in the convergence of three pressures. First, although the Bank of Japan's rate hikes have reached a 30-year high, they have yet to reverse the negative real interest rate environment, causing the attractiveness of holding yen to continue declining. Second, Prime Minister Sanae Takashi's early election has signaled fiscal expansion, further depressing the yen due to the Liberal Democratic Party's expected victory. Third, Japan holds $1.3 trillion in foreign reserves, but only $100 billion are truly available for intervention, leaving limited ammunition.

IMM data shows that speculative yen positions have become neutral, indicating that the rebound momentum is waning. Once the exchange rate breaks through 162, the self-reinforcing effect in the options market will accelerate depreciation. Japan's central bank faces limited options in this round of yen defense.

#数字资产市场动态 $FRAX

Yen volatility directly impacts the volatility of crypto assets priced in USD, which is a chain that Japanese retail and institutional investors must pay attention to.