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  • The United States (US) and Japan reached a trade deal on Wednesday.
  • The 10-year US Treasury bond yield adds more than 3%.
  • US Dollar Index gained traction and rose above the 99 handle.

The USD/JPY pair capitalized on the broad-based USD strength and the upbeat market sentiment on Wednesday to reach a fresh daily high of 107.88. As of writing, the pair was trading at 107.80, adding 0.7% on a daily basis.

The US Justice Department today released the summary of a transcript of the phone conversation between  Ukranian President Volodymyr Zelenskiy and US President Trump and said that  Trump did not violate any campaign finance laws to help ease political tensions in the US.  

The US and Japan reached a trade deal

Moreover, in a joint press conference with Japanese Prime Minister Abe, Trump today announced that they have reached a trade deal with Japan. Regarding the trade dispute with China, Trump noted that China was making big agricultural purchases from the US including pork and beef and added that they could reach a deal with China sooner than markets are expecting to further boost the risk appetite.

The  10-year US Treasury bond yield gained traction on these developments and is now looking to snap its seven-day losing streak by rising more than 3% on a daily basis. Reflecting the positive mood, Wall Street’s main indexes remain in the positive territory.

Meanwhile, despite a lack of macroeconomic data releases today, the selling pressure surrounding major European currencies allowed the Greenback to outperform its rivals. The US Dollar Index climbed to its highest level in two weeks at 99.06 and  now remains on track to end the day with strong gains.

Technical levels to watch for