JPY shorts squeezed as market lacks conviction

The one constant in recent months in the FX market has been lack of conviction amongst traders.

Erstwhile trends like GBP-bullish or JPY-bearish have run out of steam and now we get choppy consolidative markets with stop-loss runs becoming the norm.

We can blame risk-aversion out of Ukraine or any other factor but the main reason for the JPY buy-back was that too many were short and no new sellers emerged post-BOJ.

What to do now? Nothing! Wait for really silly over-kill moves and then jump in on the edges.