USD/JPY Bulls Set Sights On Y115 As Rate Logs Multi-Year Highs

Firmer U.S. Tsy yields pushed USD/JPY to its best levels since Mar 2017 on Tuesday, bringing the Y115.00 figure into play. The greenback went bid as U.S. data beat expectations across the board.

• USD/JPY appears to have charted a bullish flag pattern, by staging a clean break above the ceiling of a short-term descending channel, which suggests further gains may be in sight.
• The rate trades flat at Y114.82, after topping out at Y114.97 earlier in the session. A clearance of the nearest round figure would bring Mar 10, 2017 high of Y115.51 into play. Bears look for a pullback through Nov 9 low of Y112.73.
• Jiji reported this morning that the gov't and ruling party may discuss raising capital gains tax in a bid to strengthen redistribution.
• Japan's trade deficit in October was narrower than expected, as both imports and exports grew slower than forecast, with shipments rising at the worst rate in eight months. Separately, core machine orders were weaker than expected in September.