USD / JPY stabilizes near 110.30, seems to close for the second day in a row higher

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  • USD / JPY remains on track to end the day in positive territory.
  • The yield on 10-year US Treasuries rose nearly 6% on Wednesday.
  • US stocks are holding on to daily gains as risk flows continue to drive the markets.

The pair USD/JPY it remained relatively quiet below 110.00 in the first half of the day, but gained bullish momentum during the US session. At time of writing, the pair was up 0.42% on the day at 110.31.

USD / JPY capitalizes on rally in bond yields

The positive shift in market sentiment drove USD / JPY higher on Wednesday as the safe haven JPY struggled to find demand. Although the dollar also struggled to remain strong, the sharp rally in US Treasury yields provided an additional boost to the positively correlated USD / JPY.

Currently, the benchmark yield on the 10-year US Treasury is up 5.3% on the day to 1,228% and the S&P 500 Index is up 0.5% to 4,344.

On the other hand, the US dollar index, which managed to post gains in the previous four business days, is down 0.2% to 92.79.

USD / JPY is likely to move sideways during the Asian session on Thursday due to the Sea Day holiday in Japan. Later in the day, June existing home sales and weekly initial jobless claims data will be included in the US economic calendar.

Nonetheless, risk perception is likely to continue to have a significant impact on USD / JPY movements ahead of the weekend.

Technical levels

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