The pair is now trading at 149.98 and the day’s highs, although in a rather tight range. It has been a while and the pair has been expecting a return towards 150.00 since last week already. The last attempt at the beginning of October was rejected by the Japanese authorities, but in a context of rising yields, will Tokyo feel obliged to intervene again?
I fear that the longer USD/JPY remains hampered just below the 150.00 mark, it will create a lot more frustration for dollar bulls. They’re getting anxious, but looking at the more muted reaction to the dollar, it seems traders need this breakout higher in USD/JPY to really move the other pairs as well.
And if that doesn’t happen, the question is how long the dollar can hold out, especially if at some point we run into a bond market retracement after all the selloff.