This is via the folks at eFX.
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Societe Generale Research discusses the JPY outlook around this week's BoJ policy meeting.
- "The biggest over-shooter in FX is the yen, due to the size of Japan's net foreign asset position and the importance of expectations about future currency moves in determining the behaviour of the people who manage those investments. A chart of the last 20 years' trend in USD/JPY, averaging 106 but trading in a 75-152 range, shows the overshooting clearly," SocGen notes.
- "For now, we'll wait and see if the BOJ disappoints yen bulls enough on Wednesday to deliver attractive entry levels," SocGen adds.
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No mention of what sort of level SG is thinking of as a long yen entry.
Checking out the daily chart, perhaps 135 or so? Can USD/JPY even get that high? Maybe just under 132?. I stuck a couple of little lines at those levels on the chart but I'm sure ForexLive traders can do better - in the comments please folks!
Previews of the Bank of Japan meeting:
- TD say still plenty of room for yen gains, see as low as 120 by the end of March
- Bank of Japan preview - "may be on the verge of its biggest policy change in decades"
- The hyenas are circling the Bank of Japan
- 10-year JGB yields still pushing the limit for now
- The risks are skewed towards disappointment for yen bulls this week
