Could USD/JPY be in store for another look at the top?
I don't think the market is as worried about +6% Fed funds as it was in October but there's a good chance that the terminal rate stays above 5% for longer than previously thought. The Bank of Japan transition has also proven (so far) to be a non-event.
We're seeing multiple USD breakouts today, including against NZD -- which is at the opposite end of the yield spectrum from Japan. That highlights the possibility of USD-specific buying. However mixed into all of that is the debt ceiling fiasco and the flows around that.
What still makes me optimistic about USD/JPY is that most signs point to ongoing resilience in US growth, even relative to other developed markets. The 2-year yield has also cracked above the 61.8% retracement and USD/JPY tracks that closely.