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of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
JPY
The yen slumped 1.5% against the USD, easily the worst performer within the G10 space for Wednesday's session. We track currently at 132.70/80 just below late Wednesday highs near 132.90. Beyond that is the March 22 high around 133.00. Also note the 20-day EMA comes in at 132.82, so is close by, while the 50-day EMA is 133.41.
- A break above the 132.80/133.00 region would ease the bearish technical picture for the pair, so these levels are likely to be watched closely.
- Higher spot levels have aided a recovery in the 1 month risk reversal, which is back to -1.38, we were sub -2.00 consistently through mid March. 1 month implied vols remain relatively steady.
- The continued receding in risk aversion, particularly in the equity space, has allowed USD/JPY to realign itself more with the short-term US yield backdrop. The chart below updates the one we presented yesterday on spot yen versus the US 2yr yield. The wedge evident yesterday has closed.
- The data front today just has weekly investment flow figures. Tomorrow's March Tokyo CPI print will be a focus point for markets.
Fig 1: USD/JPY & US 2yr Yield - Past Month (Intra-day)
Source: MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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