Direct answer
USD/JPY is most likely moving because the market is repricing one of the following: US yields, Bank of Japan policy, carry trade demand, dollar strength. Traders should confirm the catalyst before assuming the move will continue.
Most likely drivers right now
US yields
If us yields changes, traders often reprice USD/JPY quickly.
Bank of Japan policy
If bank of japan policy changes, traders often reprice USD/JPY quickly.
carry trade demand
If carry trade demand changes, traders often reprice USD/JPY quickly.
dollar strength
If dollar strength changes, traders often reprice USD/JPY quickly.
How to avoid a bad read
- Check whether the move is broad-based or isolated to this asset.
- Compare the move with the strongest known catalyst.
- Confirm structure on the chart before entering.