Volatile Post Asia Close, Dip Towards 133.00 Supported

Yen was volatile post the Asia close. USD/JPY got close to 133.00 in the NY session, but we rebounded strongly back towards 133.80/90. We ended the NY session slightly lower, back at 133.60/70. This left yen little changed for Wednesday's session. USD/JPY still tracked the gyrations of US yields fairly closely, with the bottom in the pair coinciding with the 2yr yield rebounding from sub 3.90% back towards 4.00%.

• In terms of technicals, Wednesday's price action saw a break of the 20-day EMA at 133.52, but it wasn't sustained. Support will be eyed at this level and then session lows from Wednesday. On the topside is 134.47, the Apr 25 high.
• Today on the data calendar we get weekly foreign investment flows, then later on is the coincident and leading indices (final readings for Feb).
• The data calendar is also quite busy tomorrow, headlined by Tokyo CPI for Apr, but the BoJ outcome will be the main event watched by the market, where no major changes are expected.
• 1 week USD/JPY implied vol continues to push higher, last near 13.5%, but remain well below Mar and Jan highs. The 1 week risk reversal is back close to Mar lows though (last -3.55), while the 1 month is back close to -2.00, also near YTD lows.