USD/JPY: Selling rallies preferred in short-term
My sources tell me that option players are very heavily skewed in USD/JPY and that hedges will need to be increased as we break fresh ground on the downside. Today’s break below 118.00 saw the first batch of sell orders triggered and there could be much more to come. I would not be at all surprised to see EUR/JPY trading back towards 135.00 and USD/JPY towards 115.00 in coming days.
This has nothing to do with fundamentals and everything to do with market positioning.