11 Feb 2015
USD/JPY retesting NY highs above 119.50
FXStreet (Bali) - USD/JPY continues to find strong buying interest in Asia, and despite Tokyo is off on holidays today, enough buyers have emerged to take the rate within pips of Tuesday's NY highs at 119.56, although fresh highs are yet to be made.
The continuous rise in the US 10yr bond yields, breaking above 2% on Tuesday, has fueled USD/JPY demand, with the market anticipating a more hawkish Fed going forward given the flawless US NFP report last Friday. Meanwhile, the market is still expecting further monetary easing by the Bank of Japan as the Nippon economy struggles to reach its desired inflation targets within stipulated timeframes, which implies that Governor Kuroda may have to ramp up, yet again, stimulus efforts to create Japan's long awaited 'virtuous cycle.'
Another reason favouring Yen weakness, as explained by Jim Langlands, Founder at FXCharts, was due to "easing concerns over the situation in Greece after a report that the European Commission would table a compromised deal to give the country more time to negotiate a new contact with its creditors."
Jim adds: "The 4 hour charts are positive and if the day’s high can be overcome then look for an advance towards 120.00 (8 Jan high: 119.95) and then towards the Dec/Jan triple top highs at around 120.80."
The continuous rise in the US 10yr bond yields, breaking above 2% on Tuesday, has fueled USD/JPY demand, with the market anticipating a more hawkish Fed going forward given the flawless US NFP report last Friday. Meanwhile, the market is still expecting further monetary easing by the Bank of Japan as the Nippon economy struggles to reach its desired inflation targets within stipulated timeframes, which implies that Governor Kuroda may have to ramp up, yet again, stimulus efforts to create Japan's long awaited 'virtuous cycle.'
Another reason favouring Yen weakness, as explained by Jim Langlands, Founder at FXCharts, was due to "easing concerns over the situation in Greece after a report that the European Commission would table a compromised deal to give the country more time to negotiate a new contact with its creditors."
Jim adds: "The 4 hour charts are positive and if the day’s high can be overcome then look for an advance towards 120.00 (8 Jan high: 119.95) and then towards the Dec/Jan triple top highs at around 120.80."