There is little to be said about USD/JPY and its continued march higher ever since breaking the 120.00 mark. The same arguments are persisting i.e. Fed and BOJ policy divergence and the fact that the bond market rout (higher yields) continues to be rather unrelenting.

The latter is seeing a light breather to start the day but not before another round of heavy selling yesterday. Adding to that is the lack of option expiries on the way up for USD/JPY, suggesting very few interest or layers in holding at any current levels.

The technicals suggest 130.00 as the next key level and I reckon that is where we are likely to see more heavy verbal intervention by the BOJ and Japanese officials. That said, the key word in that phrase is ‘verbal’. Any major intervention remains unlikely and as long as the fundamentals are staying the course, the path of least resistance remains higher for USD/JPY at the moment.