17 August 2023, USD/JPY
USDJPY trading plan:
A so-called soft-landing economic path – in which the Federal Reserve manages to curb inflation without causing output to contract – has gained more consensus in recent weeks, prompting some investors to take on more risk or reduce bets that safe-haven assets such as Treasuries would rally. Treasuries generally become more valuable, which means their yields decline, during periods of economic weakness, but long-term yields have spiked in recent weeks, with the benchmark 10-year hitting an almost 10-month high. Rising optimism around a soft-landing, however, comes with several caveats, making it difficult for traders to embrace the prevailing macroeconomic outlook with conviction.
Investment idea: buy 145.90 and take profit 146.60.