USD/JPY intermarket: risk-on Wall Street and yields up, USD/JPY up to challenge 111 handle

Currently, USD/JPY is trading at 110.76, up 0.09% on the day, having posted a daily high at 110.84 and low at 110.17.

USD/JPY has rallied with a recovery in the equities on Wall Street. Benchmarks such as the Dow Jones and S&P 500 has tallied up gains exceeding the pre-healthcare failures levels in the case of the latter while the Dow Jones is 90% of the way there. 

At the same time, US yields are up, with the 10-year rallying from 2.3585 to 2.4070 so far as risk turns positive. Should 10 years move back to 2.44 and 2.51, the spread between the US and Japan could equate to USD/JPY moving back onto the 111 and the 113 handles respectively. 

USD/JPY levels

Buy USD/JPY with target at 112.75 - Westpac

While the market continues to recover and yields rise, rallies could find initial resistance at 113.44 and 16th March highs. For a highly bullish case, a break through 115.62 and the 17th Jan weekly high opens the 16-month resistance line at 117.52. To the downside, 109.90 is key as being the 50% of the Nov/Dec rally.