USD/JPY to race higher as US Treasury yields continue to rise


The consolidation in the USD/JPY over the past two weeks has given a firm base at 108.50. Meanwhile, US 10-Year Treasury yield climbed above 1.7%, a 14-month high. If American Treasury rates continue to rise they will pull the USD/JPY higher, according to FXStreet’s Analyst Joseph Trevisani. 

Key quotes

“With the US Federal Reserve apparently happy or at least tolerant of rising Treasury and commercial yields and the BOJ quietly pleased, the direction of the USD/JPY is higher. Nonetheless, even under this fundamental impetus, the longer the pair lingers without new highs, the greater the temptation for traders to book some of those gains.”

“The USD/JPY ranged above 110.00 for much of 2018 and 2019 so there is no fundamental reason that if US rates continue to rise, it could not return to those levels.”

“Technical analysis shows the USD/JPY has good support at 108.50 and at 107.90. Immediate resistance at 109.35 and 109.65 is weak. The early pandemic plunge and recovery from late February to late March last year will give little pause one way or another, the traded volumes on those panicky days were far too thin for positioning.”

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD pressured in critical daily resistance ahead of ECB

EUR/USD is flat in the open this week at 1.1645 at daily resistance with the US dollar trying to hold up. Investors have taken profits since the dollar index hit a one-year high last week as they build expectations for sooner rate increases in other currencies.

EUR/USD News

GBP/USD: Buyers defends 1.3750 below 100-day SMA

GBP/USD edges higher on the first trading day of the week in the Asian trading hours. The pair faces strong resistance near 1.3850 below the bearish sloping line. MACD signals sideways momentum with the underlying neutral sentiment.

GBP/USD News

EUR/USD pressured in critical daily resistance ahead of ECB

EUR/USD is flat in the open this week at 1.1645 at daily resistance with the US dollar trying to hold up. Investors have taken profits since the dollar index hit a one-year high last week as they build expectations for sooner rate increases in other currencies.

EUR/USD News

SafeMoon price presents a buy opportunity before 35% gains

SafeMoon price coils up under a crucial resistance level at $0.00000239. A sudden burst in buying pressure that shatters this barrier can kick-start a 35% ascent. In some cases, SAFEMOON could pull back to $0.00000198 or $0.00000175 support floors.

Read more

Wall Street Week Ahead: Huge week of earnings ahead AAPL, MSFT, GOOGL, AMZN, FB

Equity markets remain elevated with more all-time highs on Thursday for the broader S&P 500 while the Dow registered new highs on Wednesday and Thursday. So far late into Friday's session, the markets are seeing some profit-taking to end a solid week.

Read more

Forex MAJORS

Cryptocurrencies

Signatures