- USD / JPY breaks above 113.00, the level last seen in December 2018.
- Rising US Treasury yields and the strength of the US dollar are the main drivers of the USD / JPY pair.
The USD/JPY It is skyrocketing during the American session, trading at 113.38, up 1.03% at the time of writing. The risk appetite environment, as evidenced by rising US stock indices, posted gains between 0.43% and 0.86%. Additionally, US Treasury yields, with 10-year yields above the 1.60% threshold, are putting upward pressure on the USD / JPY pair.
The resilience of the US dollar continues despite the dismal US non-farm payroll report.
In addition, the US dollar index that tracks the performance of the dollar against its rivals is advancing 0.16%, currently at 94.24, weighing on the Japanese yen and driving the dollar.
On Friday, the US non-farm payroll report was worse than expected, but the August upward revision has kept the prospects for a Federal Reserve bond phasing out announcement alive. In addition, US stock indices closed at a loss and US Treasury yields rose, reinforcing the aforementioned, as investors did not buy in the fall.
On the macroeconomic front, on Tuesday, the Japanese economic agenda will present the monthly and annual Producer Price Index and Bank Loans on an annual basis for September. Regarding the US, JOLTS job offers for August and Atlanta Federal Reserve Chairman Raphael Bostic could add a new catalyst for USD / JPY traders.
USD / JPY Price Forecast: Technical Outlook
Daily chart
USD / JPY is trading well above the daily moving averages (DMA), above 113.00, supporting the bullish bias. Momentum indicators like the Relative Strength Index (RSI) are at 75, suggesting that the pair is oversold, so a consolidation or correction towards 113.00 could be in play.
On the way north, December 2018, the swing highs around 113.50 is the first resistance level. A breakout of the latter could open the way for more bullish stocks. The next supply zone would be 114.00, and then the September 2018 highs would hover around 114.55.
ADDITIONAL LEVELS
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