USD/JPY climbs back above 110.00 to its highest level since 22 January
The market continues to brush aside coronavirus fears as traders and investors are hoping that the worst is over, as risk trades continue to extend gains in trading today.
Yen pairs are moving higher across the board as we see bond yields jump higher as well to start European morning trade. US Treasury 10-year yields are up by over 3 bps to 1.63% and that is underpinning USD/JPY to push up to a three-week high of 110.08.
The key for buyers is to stay above the figure level as the near-term bias continues to favour an upside move (still above the 100-hour moving average) with further resistance seen around the January highs at 110.25-30 now.
I still reserve some skepticism about how the market is ignoring the potential impact of the coronavirus outbreak but it is hard to argue against the unstoppable movement in equities in particular, especially when the charts are also being more risk-supportive.
Among the yen pairs to watch out for, pay attention to AUD/JPY as it moves up to a test of the key daily moving averages around 0.7435 again. A break above that may spur another leg higher in risk trades in the sessions ahead.
