EUR/JPY DE10Y vs. JP10Y
Increased spread between Germany 10-year bond yield vs Japan 10-year yield could indicate a slide in the Euro against the Yen. Even though the yield is higher for European bund, the risk appetite is declining, while the global economy is projected to have a slow growth rate through out 2019. This means that investors seek safe heaven assets like the Yen and JP10 bonds, that’s why we could see lower yield on the JP10Y. While the bond buying program from ECB is slowly decreasing - will increase the DE10Y yield. Maybe we could see a negative JP10Y yield this year, as it happened in 2016 and was the reason behind the slump of the pair from 128 to 111.
I see a weak risk appetite, more demand on JP10 or even lower Japanese bonds, and a higher supply of European bonds. If the risk appetite is weak, we will also see a lower S&P and positive correlated indices with the S&P lower. European stocks is a risk in 2019 = less demand for the euro.
If the risk sentiment is changing, then we could see a higher EUR/JPY. I am closely monitoring this factor.
A range throughout 2019 of the pair is also possible.
Holding shorts, and will add more if we break 123,400 and 121,500.
I see a weak risk appetite, more demand on JP10 or even lower Japanese bonds, and a higher supply of European bonds. If the risk appetite is weak, we will also see a lower S&P and positive correlated indices with the S&P lower. European stocks is a risk in 2019 = less demand for the euro.
If the risk sentiment is changing, then we could see a higher EUR/JPY. I am closely monitoring this factor.
A range throughout 2019 of the pair is also possible.
Holding shorts, and will add more if we break 123,400 and 121,500.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.