USD/JPY intermarket: watch 10-years and the 2.3% psychological level / Ichimoku cloud

Currently, USD/JPY is trading at 110.41, down -0.26% on the day, having posted a daily high at 110.79 and low at 110.31.

On an intermarket basis, the yen has been edging higher since the 11th July and a few trading days late than when US yields in the 10-year bench mark started to drop from 2.3856% highs. The rates were then accelerating below the 2.30% psychological mark, breaking below the 112.80 support that gave way to a test below the 111 handle and to 110.63 lows on 23rd Jan. 

The US week ahead is an important one for markets - UOB

From here, yields were back on the rise from 2.2375% lows and USD/JPY caught a bid a number of days later but unable to sustain a break above the psychological 112 handle.  

2.33% was as high as the 10-years were able to recover back to before dropping again and towards current levels in recent sessions. The DXY remains under water below the 94 handle still and the yen is better bid still, risking a test below the psychological level at 110.00 that guards the weekly Ichimoku cloud base at 108.83. The weekly cloud top is currently at 112.15 and comes in line with 10-years back above the psychological 2.30% as is the case of the 25th July and 26th July spot FX levels.