Many find trading the Japanese yen against the U.S. dollar, USD/JPY, a complicated proposition. This should not be the case when the Japanese yen is understood in terms of U.S. treasury bonds, notes and bills. The main driver of this pair is not only treasuries, but interest rates in both Japan and the U.S. This means that the pair is a measure of risk that determines when to buy or sell the USD/JPY, in terms of interest rates. Knowing where interest rates are heading will determine the direction of this pair.
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Anthony DiChi at TradeCurrencyNow,
America’s Forex News and currency information source.