USD/JPY climbs over 109 ahead of European markets
- Spiking Treasury yields are driving the US Dollar higher against the Yen, and the USD/JPY is climbing into fresh highs.
- Little data on the docket for Wednesday leaves markets exposed to broader sentiment as bond yields hit key levels.
The USD/JPY is breaking higher in Asia trading, breaking over the 109.00 major handle as the US Dollar resumes its yield-fueled climb.
The Greenback has been ramping up into the 109.00 area since yesterday, when the USD/JPY hit a session high of 109.20 before settling back down into the 108.55 region. Traders have been pushing the pair steadily higher since late Tuesday's bottom, and the US Dollar has punched back through the level once more after building a floor from 108.80.
The Dollar is being driven higher by 10-year US Treasury yields, which have hit multi-year highs and crossed the key 3% yield mark, sending traders scurrying into the USD as equities weigh their options carefully in an environment where borrowing is becoming increasingly expensive.
USD/JPY Levels to watch
The pair has turned significantly bullish on Daily candles, closing higher for five consecutive trading days and looking set to do so again for a sixth, and the USD/JPY is quickly approaching 109.70, the 50.0 Fibo retracement level of January's initial tumble from 114.75. Right behind that is the 200-day SMA sitting near 110.25, while a bearish correction will be faced with support from early April's congestion zone from 107.50 to 106.60, with further support from April's low of 105.65.