Higher U.S. Rates & Buy Signal in USDJPY
U.S. Treasury Bond prices are starting to slide lower, reminding financial market participants that despite what’s occuring on the short end of the yield curve, long-term interest rates are indeed starting to rise in the U.S. — see Treasury Bond Weekly Chart below. Interest rates rise when Treasuries fall, and fall when Treasuries rise. U.S. debt instruments trade in the open market and will rise and fall based on supply and demand and market perceptions. Despite Federal Reserve and Treasury Dept policies, it’s the open market itself that sets long-term interest rates.
Today gave us a buy signal in USDJPY as this market cleared it’s Central Pivot today following a potential double from 11/02 to yesterday — 11/11. Should yesterday’s low prove near-term support going forward this pair will have put in a higher low than the previous months low.
Jay Norris
www.trading-u.com
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