News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Oil - US Crude
Wall Street
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • USD awakens, placing GBP/USD on the backfoot, while EUR/GBP cracks 0.90. Get your #currencies update from @JMcQueenFX here:
  • What are some factors impacting Euro’s forecast this quarter? Get your free forecast here:
  • Emotions are often a key driving force behind #FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here:
  • Technical indicators are chart analysis tools that can help traders better understand and act on price movement. Learn more about the importance of technical analysis here:
  • The British Pound, Australian Dollar and US Dollar may all experienced heightened periods of volatility as geopolitical risks in North America, Asia and Europe rattle global financial markets. Get your $GBPUSD market update from @ZabelinDimitri here:
  • The New Zealand Dollar may continue to outperform the haven-associated US Dollar as price breaks above key long-term resistance. Get your $NZDUSD market update from @DanielGMoss here:
  • #Gold prices declined following bearish technical cues, but a key zone of support was reinforced over the past 48 hours. #XAUUSD volatility risk is elevated ahead of the #USElection -
  • What is the US Dollar outlook based on retail positioning ahead of the November 3rd presidential election? EUR/USD may fall as AUD/USD rises. Which way could USD/CAD capitulate? Find out from @ddubrovskyFX here:
  • US #COVID19 cases hit a record for a second consecutive day -BBG
  • The Indian Rupee may weaken following a breakout higher in USD/INR. Despite rising global stock market volatility, the Nifty 50 has been holding its ground. Could it capitulate lower? Find out from @ddubrovskyFX here:
US Dollar Sets Bottom vs Yen as Treasuries Plummet, Sentiment Flips

US Dollar Sets Bottom vs Yen as Treasuries Plummet, Sentiment Flips

2012-03-14 16:01:00
David Rodriguez, Head of Product

A dramatic surge in US bond yields has sent the US Dollar to fresh 11-month highs against the Japanese Yen, and a tectonic shift in forex market sentiment suggests the USDJPY rally is here to stay.

The US 10-year Treasury Yield has surged above its 200-day Moving Average for the first time since July, 2011, and the highly-correlated US Dollar/Japanese Yen has broken to similar peaks.

Chart of US 10-Year Treasury Yield

forex_us_dollar_forecast_to_rally_treasury_yields_body_Picture_1.png, US Dollar Sets Bottom vs Yen as Treasuries Plummet, Sentiment Flips

Data Source: Bloomberg

If this is truly the break we have been waiting for in bond yields, we expect the USDJPY to follow in kind. The 10-year Treasury Yield has actually remained somewhat subdued and the yield Japanese Yen has nonetheless fallen sharply against the US Dollar. Today’s surge in both the USDJPY and the 10-Year rate suggests that there is yet another reason to watch for further Yen weakness/US Dollar strength. Such insight lines up well with a similarly significant shift in forex trader sentiment.

US Dollar/Japanese Yen versus US 10-Year Treasury Yield

forex_us_dollar_forecast_to_rally_treasury_yields_body_Picture_2.png, US Dollar Sets Bottom vs Yen as Treasuries Plummet, Sentiment Flips

Data Source: Bloomberg

Our proprietary Speculative Sentiment Index (SSI) data has called for US Dollar losses against the Japanese Yen since it traded below ¥90, but a more recent shift says the opposite. The SSI measures retail forex trader sentiment as seen through FXCM Execution Desk data. Crowds have remained heavily net-long for nearly two years. As of today, crowds have moved net-short and provide strong contrarian signal that the pair could continue higher.

US Dollar/Japanese Yen Forex Retail Positioning Chart

Short interesthas not exceeded long interest for nearly 2 years. Today’s shift is very significant.

forex_us_dollar_forecast_to_rally_treasury_yields_body_Picture_3.png, US Dollar Sets Bottom vs Yen as Treasuries Plummet, Sentiment Flips

Data Source: FXCM Execution Desk

Chart source: TradeStation

Where do we go from here? It would be foolish to believe that the USDJPY could not correct lower before continuing to fresh highs. Our forex technical forecast predicts that 81.95 is a significant area for support. If and when the US Dollar does correct lower against the Japanese Yen, we may look to buy in expectations of continued USDJPY strength.

--- Written by David Rodriguez, Quantitative Strategist for

To receive reports based on the Speculative Sentiment Index and other quantitative studies via e-mail, send a message with subject line “Distribution List” to

Interact with and follow David via Twitter at

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.