Positioning has been little changed since early August. Prices narrowly closed below key support at 76.25, the 76.4% Fibonacci extension level, but the move lacks conviction and threatens to run into renewed intervention from Japanese authorities. We will remain on the sidelines, opting not to participate in the tug of war between markets and policymakers and view any weakness over the months ahead as a long-term buying opportunity capitalizing on the forthcoming rise in US Treasury yields – a historic driver of USDJPY price action – in future years.
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