U.S. Dollar Tests Yearly Highs As Traders Focus On Hawkish Fed Policy Outlook: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

USD/JPY 121126 4h Chart

USD/JPY continues its attempts to settle above the resistance at 160.00 – 160.50 as traders focus on rising Treasury yields. The yield of 2-year Treasuries climbed above the 4.85% level, while the yield of 10-year Treasuries settled above 5.09%. Rising Treasury yields serve as a major negative catalyst for the yen as interest rates in Japan stay at low levels.

If USD/JPY manages to settle above 160.50, it will head towards the resistance level at 162.00 – 162.50. It remains to be seen whether BoJ intervenes to provide support to the Japanese yen. In case BoJ does not intervene, USD/JPY may climb above the 162.50 level and move towards the 164.00 level.