USD/JPY targets 104.00 near term – Danske Bank

Jens Sorensen, Chief Analyst at Danske Bank, believes the Japanese safe haven could gather extra traction in the next 1-3 months.

Key Quotes

“USD/JPY has stabilised after past weeks’ sell-off. 25 delta USD/JPY risk reversals have bounced higher, which could indicate near-term stabilisation in the cross”.

“However, we still expect the cross to trade lower going into end of the fiscal year in Japan (31 March) driven by portfolio flows, fragile risk environment and stretched short JPY positioning. We target 104 in 1-3M”.