It’s getting increasingly hard for professional traders to generate any returns in these markets and it’s no surprise to see hedge funds clambering once more onto their favoured USD/JPY long trade in the hope of a developing trend.
The clever ones bought in around 101.00 when the stops were being triggered and the Japanese semi-official bids turned up. The others are chasing it higher but are running into heavy offers from Japanese corporates and option players trading the range.
I still think we are in a strong sideways formation in USD/JPY and it will take an important event to jolt it out of its sleep cycle.