USDJPY holds strong despite falling yields

25/01/2021

The USDJPY pair was flat on Monday, trading at around 103.80 as traders totally ignored cratering US yields. 

The 10-year yield seems to be breaking down from the recent triangle pattern. The support of the formation is currently near 1.075%, and if this level is taken out, bonds could rally further. The next target should be at the psychological level of 1.0%.

As the USDJPY pair has been moving sideways, it's not easy to find relevant support and resistance. 

It looks like the first selling area could be at around 103.85, and if the greenback rises above that level, we might see a rally toward 104.00/10.

Alternatively, the first spotted might be spotted near 103.70, and if not held, the USD might decline toward last week's lows of 103.35.

If the US yields continue to decline, the bearish pressure could prevail, with the mid-term target at the current cycle lows of 102.60.
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