Yen advances to level that threatens this year’s big foreign exchange short

The resurgent yen has hit a level that has traders wondering if a technical rebound may turn into a rally that derails the foreign exchange world’s favorite short.

The Japanese currency climbed more than 1% Friday, rising for a third day in the wake of the U.S. Federal Reserve meeting, as reduced expectations for rate hikes caused hedge funds to cover short bets from one of the biggest global macro trades of the year.