The dollar remains steady overall so far this week, after some back and forth action in the past few sessions. USD/JPY in particular has been a volatile one, running lower after BOJ governor Ueda’s remarks yesterday before giving all of that back. The pair now trades in and around the 148.00 mark, still keeping above the 100-day moving average of 147.51 currently.
As things stand, I’d argue that the action in the bond market is reflective of the push and pull mood in broader markets so far this week:
US Treasury 10-year yields (%) daily chart
10-year yields in the US are still holding just above its 200-day moving average (blue line) of 4.097%. And that remains the key line in the sand for the bond market at the moment. There’s not much of an extension higher in yields just yet but it isn’t quite falling off either after the squeeze to start the year.
The action here is what is keeping the dollar on edge and relatively steady across the board this week. EUR/USD is little changed on the week, down 0.1%, with large option expiries at 1.0900 set to cap price action today as well. The ECB will potentially offer something at least for the euro to work with tomorrow.
It seems like only the S&P 500 that seems to be somewhat trending as it builds on the break above 4,800 and to fresh-all time highs. The move is one that owes much to a continued rise in tech stocks though, as broader stock market sentiment remains more tepid. That might be a slight warning signal for equities in general especially if yields still has the propensity to push higher from here.