USD/JPY Gets Close To 2022 Highs Before Sharp Pullback, Dips Remain Supported

Post the Asia close on Monday, USD/JPY got just above 151.90 before pulling back sharply. We retraced back to 151.21, before support emerged. We last tracked near 151.70/75 in early Tuesday dealing, having lost a modest 0.11% in yen terms for Monday's session.

• The sharp pull back in offshore trade prompted intervention fears, although our London team noted, "Today's volume spike on the move was actually considerably smaller relative to similar spikes in JPY on Oct26 (~10k contracts) and Oct17 (just over 20k contracts). As a reminder the BOJ confirmed at the end of October that no FX intervention had taken place across the month-ending Oct27 in its official FX reserves data (next released on Nov30), so today's smaller move likely more of the same."
• BBG quoted analysts which noted Monday's 152.00 option expiry (NY cut) as another potential factor driving intra-day volatility (see this link).
• With Monday's high just 4 pips shy of 2022 highs at 151.95, focus is likely to remain on intervention risks in the near term. Note we also have another sizable option expiry at 152.00 ($2.31bn) at tomorrow's NY cut.
• The data calendar is empty today, with Q3 GDP out tomorrow the main focus.