USD/JPY: Break below 134.50 unlocks additional downside potential – ING

USD/JPY has broken below 135.00. A dip under the 134.50 mark is set to trigger another leg lower, economists at ING report.

Markets may struggle to live with sub-3.50% rates for long

“The main risk for USD/JPY is that UST 10Y yields fail to find extra support at 3.50%: a further bond rally could force a break below the 134.50 200-Day Moving Average and unlock additional downside potential for USD/JPY.”

“Still, markets may struggle to live with sub-3.50% rates for long in the current environment.”