Pips for Breakfast: February 9, 2026

The Bank of Japan is currently performing a delicate dance where they pretend to want higher rates while the economy politely disagrees.

On This Day

In 2016, global markets decided they suddenly didn't like banks. USD/JPY plummeted three big figures in a single day as investors fled to safety, proving that when the financial sector catches a cold, the yen gets a massive shot of adrenaline.

The Play

USD/JPY is the main character today. With the Nikkei hitting new highs but real wages falling for the 33rd month in a row, the BoJ is effectively paralyzed. Look for a fade of any yen weakness if verbal intervention from Japanese officials gets louder. If we break 149.50, the "monitoring with a sense of urgency" headlines will start hitting the wires.

AUD/USD is also on the radar. The 20 year prison sentence for Jimmy Lai is a sharp reminder that China-West relations remain brittle. This geopolitical friction usually flows through the Aussie dollar first. A break below 0.6500 looks tempting if the mood in Asia stays sour throughout the London open.

What's on Deck

It's a light calendar day, which means the market will likely invent its own drama. We have some secondary Japanese data and the usual Monday morning drift. Watch the Nikkei for clues on JPY sentiment. If the equity rally stalls, the yen might actually find a floor for once.

The Data Behind the Patterns View Packages →

Quick Pips

EUR/USD: Stuck in a tight range. February is usually the month where the euro tries to convince everyone it's a real currency before giving up and reverting to the mean.
GBP/USD: Cable is holding steady. Without major UK data today, it'll likely follow the broader dollar trend like a loyal shadow.
USD/CAD: Oil prices are twitchy. Any shift in the crude market will send this pair looking for a direction it probably won't find until tomorrow's data.

Why Your P&L Cares

February is the teenager of the trading year. It starts out following its January parents' rules, then rebels around the middle of the month. Historically, this week is about trend continuation. If the dollar was strong last week, the path of least resistance is usually higher today.

The Japanese wage data is a legitimate problem for the BoJ. Falling real wages make it nearly impossible for them to hike rates without looking like they're intentionally hurting households. This keeps the yen as the world's favorite punching bag. However, the market has a short memory. Back in 2016, we saw how quickly the yen can reverse when the carry trade gets nervous. Don't get too comfortable being short the yen at these levels.

The Bottom Line

The Nikkei is mooning and Japanese workers are getting poorer in real terms. It's a classic macro tragedy. Stay nimble, watch the intervention headlines, and don't get married to a trend that's more than two weeks old. Now go make some pips. You're fed.