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Dollar/yen broke down on political worries and lost the 110 level. Could it extend the  drop?

Here is their view, courtesy of eFXnews:

Societe Generale FX Strategy Research notes that the last year can be divided into two ranges for USD/JPY and US 10-year treasuries:

Pre-Trump, USD/JPY traded in a 98-108 range and 10s in a 1.31.8% range.  Since mid-November,  USD/JPY has traded in a 108-119 range, 10s in a 2.15-2.70 range. We are at the bottom of that range, in both FX and bond markets.

From here, SocGen prefers to  be short yen than short Treasuries.

“Now that we’ve see a sizeable long position build-up in CFTC data, We’re  more inclined to view this latest move as the last hurrah of the bond bulls, and  fade it by staying long EUR/JPY and going long USD/JPY,” SocGen advises.

USD/JPY is trading circa 109.35 as of writing.

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