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The USD/JPY pair trades near this year high at 108.64 as yields continue to provide support. USD/JPY is bullish despite overbought conditions and could reach the 109.00 price zone, according to FXStreet’s Chief Analyst Valeria Bednarik.

See –  USD/JPY: Levels between 109.00 and 110.00 to be the top for this current rally – MUFG

Key quotes

“The yield on the benchmark 10-year Treasury note stands at 1.60%, not far from its YTD high of 1.62%. The greenback started the week down amid weekend news indicating progress in the US stimulus bill and spurring some risk-appetite. Nevertheless, equities edged lower in Asia, while European indexes hold within positive levels but retreating from intraday highs.”

“USD/JPY is overbought but still bullish. The pair could reach the 109.00 level should yields keep rising, but the risk of a bearish corrective decline increases if the rally extends beyond that level.”