Yen staying reasonably quiet in early interbank trade

The market has had plenty of time to digest any statements from the G20 meeting and movements have been fairly limited in early interbank trade. Dealers say that the lack of any stop-loss orders close to the market is the main reason behind the quiet start.

USD/JPY is trading around 93.70 and sell orders above 94.00 should ensure that we don’t see any panic rushes higher in early Tokyo. Dealers at sales desks suggest that the main danger on the day is still higher, if Japanese corporates start to aggressively unwind long term hedges. If they don’t, the hedge fund market is still very long and they may start booking profits if recent highs are tested and confirmed.

Best to adopt a wait-and-see approach. Good luck this week.