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JPY: USD/JPY Breaks Sub 20-day EMA, Large 153.00 Strike Option Expiring NY Wed

JPY
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Yen was the clear outperformer in Tuesday FX trade. It was the only G10 currency to rise against the USD. Yen gained nearly 0.80% for the session and sits near 153.00 in early Wednesday dealings. We steadily tracked lower for most of the post Asia close period. The USD BBDXY index is up around 0.25%, near 1288 at the end of US dealings. Yen was a notable outperformer against higher beta FX, with AUD down nearly 0.60%. 

  • There didn't appear to be a clear catalyst for yen outperformance, although yesterday's firmer services PPI, along with wage comments from PM Ishiba likely helped. Focus will be on the Dec BoJ meeting, which is live per recent Ueda comments. The next major data point will the Tokyo Nov CPI out this Friday.
  • USD/JPY may also be playing some catch up to the downside with softer US-JP yield momentum, which is what we highlighted yesterday. US yields were little changed in aggregate for Tuesday's session.
  • For USD/JPY technicals, we have broken down through the 20-day EMA support point, near 153.70. The 50-day EMA is further south at 151.50. Still, moving average studies are in a bull-mode position highlighting a dominant uptrend. The bull trigger is at 156.75, the Nov 15 high. This keeps the current pullback as corrective from a short term standpoint.
  • Risk aversion from the tariff threat was also evident, although US equities still finished higher in Tuesday cash trading.
  • Finally note, the option expiries for NY cut later: Y153.00($2.7bln), Y153.50-60($690mln) Y155.95-00($1.2bln). The 153.00 strike could influence spot trends today. 
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Yen was the clear outperformer in Tuesday FX trade. It was the only G10 currency to rise against the USD. Yen gained nearly 0.80% for the session and sits near 153.00 in early Wednesday dealings. We steadily tracked lower for most of the post Asia close period. The USD BBDXY index is up around 0.25%, near 1288 at the end of US dealings. Yen was a notable outperformer against higher beta FX, with AUD down nearly 0.60%. 

  • There didn't appear to be a clear catalyst for yen outperformance, although yesterday's firmer services PPI, along with wage comments from PM Ishiba likely helped. Focus will be on the Dec BoJ meeting, which is live per recent Ueda comments. The next major data point will the Tokyo Nov CPI out this Friday.
  • USD/JPY may also be playing some catch up to the downside with softer US-JP yield momentum, which is what we highlighted yesterday. US yields were little changed in aggregate for Tuesday's session.
  • For USD/JPY technicals, we have broken down through the 20-day EMA support point, near 153.70. The 50-day EMA is further south at 151.50. Still, moving average studies are in a bull-mode position highlighting a dominant uptrend. The bull trigger is at 156.75, the Nov 15 high. This keeps the current pullback as corrective from a short term standpoint.
  • Risk aversion from the tariff threat was also evident, although US equities still finished higher in Tuesday cash trading.
  • Finally note, the option expiries for NY cut later: Y153.00($2.7bln), Y153.50-60($690mln) Y155.95-00($1.2bln). The 153.00 strike could influence spot trends today.