A. “Risk on” refers to the reflation trade, the idea that the global economy is in recovery and safe-haven plays like long dollars, long US Treasuries, long Swiss franc, long Japanese yen are being liquidated. Typically, in a “risk-on environment, the dollar falls against most currencies, particularly commodity currencies, on the idea that fast-growing economies like China will be large consumers of raw materials.
“Risk off” is the reverse. Traders want safety and look for it in the US dollar, US Treasuries, etc and they want to avoid commodity currencies for fear of lower global growth.
US bond yields tend to fall in a risk-off environment and went to rise in a risk-on environment. Investors move out of the safety of low yielding bonds when prospects for higher returns elsewhere improve.