Tests Sub 153.00 Before Stabilizing, Vols/Risk Reversals Still Away From 2024 Extremes

USD/JPY has hit fresh lows as we approached the Tokyo fix. We got to 152.86, before retracing slightly higher in recent dealings, last near 153.30/35 still around 0.40% stronger in yen terms.

• The May 6 low at 152.78 isn't too far away. The 200-day EMA is near 152.4, while the simple 200-day MA is back close to 151.50/55.
• Yen is dominating crosses, continuing to outperform the likes of AUD and NZD, which are off 0.20-0.30% so far against the USD.
• The 1 month risk reversal is at -1.72, just up from recent lows, but still above cycle lows around -2.0.
• 1 month implied is tracking higher, last near 10.3%, also short of 2024 highs. The 1 week was last around 13.8%, as next week's BoJ meeting comes into view.
• BoFA note: "Japanese RM community are still undecided whether this is the level to buy or keep continue the unwind. I still think the majority of them are leaning on picking up the 200DMA 151.50 to 152.00 zone. We have seen some exporters hedging on the way down, not super panicky and will be waiting for rallies towards 154.50-70 zone."