With the release of key economic data delayed and policy guidance temporarily lacking clarity, market sensitivity to political events has risen noticeably. President Trump’s high-profile public endorsement of Sanae Takaichi ahead of Japan’s election breaks with the long-standing norm of US presidents avoiding direct involvement in allied nations’ domestic politics. This move has brought political uncertainty forward into market pricing, prompting capital to reduce exposure preemptively.
The impact of this event extends beyond Japan’s electoral dynamics. More importantly, it signals rising risks around policy continuity. A former US president leveraging personal influence to intervene in a key ally’s internal affairs has forced markets to reassess the future trajectory of US–Japan relations, trade and tariff positions, and the broader stability of the Indo-Pacific strategy. In the absence of nonfarm payroll data, political signals have become one of the few interpretable directional variables in the near term.
Across markets, the combination of election-related uncertainty and geopolitical risk has encouraged more conservative positioning ahead of the weekend. Risk appetite for yen-related trades and high-volatility carry strategies has declined, reflecting a market that is not yet prepared to re-expand risk.
In this phase, the crypto market acts primarily as a mirror of broader risk sentiment. BTC has pulled back toward its weekly demand zone, currently trading around the 66,000 level. Key structural support lies in the 62,000–60,000 range, while a sustained move back above 71,000–73,000 would be required to signal an improvement in risk-taking appetite. Until political uncertainty is more fully digested, price action is likely to remain dominated by consolidation and post-deleveraging rebalancing.
