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Japanese yen forecast: USD / JPY boom continues as bond yields reach new highs


Japanese Yen analysis and news:

  • USD / JPY Track bond yields higher
  • BoJ remains calm about weaker yen

USD / JPY Track bond yields higher

The Japanese yen remains on the back foot as global bond yields continue its upward trajectory, in which the US reached a new multi-year high of 2.78% in 10 years. After that, USD / JPY made a break through the 125.00 handle, which was previously the line in the sand for the BoJ in 2015. However, with BoJ Governor Kuroda reiterating that a weak currency is good for the economy, the BoJ seems calm about Yen weakness for now. In turn, risks remain directed further upwards, with declines likely to find support, especially in the current environment with yields still rising.

USD / JPY vs US 10Y Yield

Source: Refinitive

Customer sentiment signals further bullish momentum for USD / JPY

Data shows 23.58% of traders are net long with the ratio of traders short to long at 3.24 to 1. The number of traders net long is 3.54% higher than yesterday and 17.31% lower from last week, while the number of traders net short is 6.23% higher than yesterday and 11.63% higher from last week.

We usually have a conflicting view of crowd sentiment, and the fact that traders are just short indicates that USD / JPY prices may continue to rise.

Traders are further just short of yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger USD / JPY bulls conflicting trading bias.

Top levels

125.85 (2015 high)

130.00

135.15 (2002 high)

USD / JPY Chart: Monthly Timeframe

Japanese yen forecast: USD / JPY boom continues as bond yields reach new highs

Source: Refinitive

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