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27 Jan 2016
USD/JPY: improved equity mood, buying dips - Westpac
FXStreet (Guatemala) - Analysts at Westpac had a number of high conviction trade plans for crosses and suggested to Buy USD/JPY into 116.05, stop 114.85.
Key Quotes:
"The improved equity mood has helped place considerable distance between USD/JPY and last week's panicky lows around 116. BoJ Gov Kuroda has stuck to his usual script but local media reports suggest further easing will at least be discussed Thu-Fri"
"We don't expect action as soon as Fri but the risks are growing and won't disappear on a steady hand with inflation so far from target. Moreover, CFTC data shows leveraged funds are (slightly) long JPY, so fresh USD/JPY longs will be tempting, albeit dampened by a lack of confidence in Fed hikes. We retain a bias to buy dips on USD/JPY."
Key Quotes:
"The improved equity mood has helped place considerable distance between USD/JPY and last week's panicky lows around 116. BoJ Gov Kuroda has stuck to his usual script but local media reports suggest further easing will at least be discussed Thu-Fri"
"We don't expect action as soon as Fri but the risks are growing and won't disappear on a steady hand with inflation so far from target. Moreover, CFTC data shows leveraged funds are (slightly) long JPY, so fresh USD/JPY longs will be tempting, albeit dampened by a lack of confidence in Fed hikes. We retain a bias to buy dips on USD/JPY."