EUR/JPY could extend rally as German-Japan yield spread widens
Much has been said about the US 10y yields breaking out and a lot of focus will be on that ahead of the FOMC decision tonight. But It is not just the US where bond prices are slumping. Yields are rising across the major developed economies as this chart shows:
Source: TradingCandles.com and TradingVew.com
Today, German 10y yields are also breaking out of the triangle:
Source: TradingCandles.com and TradingVew.com
This is causing the German-Japan 10-year yield spread to widen:
Source: TradingCandles.com and TradingVew.com
Given the rising German yields and the widening of the German-Japan yield spread, the EUR/JPY should be able to continue higher from the support area shown on the chart:
Source: TradingCandles.com and TradingVew.com
We have had great success with the EUR/JPY for the private group in the past, for example THIS one:
Source: TradingCandles.com and TradingVew.com
Let’s hope the good run of form continues for the EUR/JPY and judging by the price action on the yield charts that’s how it is looking like at the moment.
Fawad Razaqzada,
Trader | Analyst | TradingCandles.com
e: Fawad.Razaqzada@TradingCandles.com
