USD/JPY daily chart
Bond markets have been more volatile this week, but USD/JPY traders don’t seem to be waiting on the sidelines. Buyers are keen to push their agenda after defending the decline near the 100-day moving average (red line) earlier this week. Currently, the price is moving higher on this day to test the January high of 148.80.
This is an important level to watch on the daily chart, and a solid break here will set up the next possible move higher towards 150.00.
The Bank of Japan made some somewhat dovish remarks here today. So that may be playing some role in the price movements that we’re seeing. However, I would argue that this commentary still fits with what central banks have been feeding the market in recent months. For now, the Bank of Japan has no choice but to wait for spring wage negotiations.
In any case, technicality is still an important factor to pay attention to. And in this case, USD/JPY may be about to show some price action by the end of the week.
The only strange thing is that it happened despite more sideways activity in the bond market this week. The 10-year US Treasury yield could rise 2.5 basis points today to 4.123%. However, overall, it remains largely constrained by recent highs around 4.20%.
