Seasonal Pattern in Play : Long Safe Haven On a monthly timeframe, Yen is bid from Jun to August which means third quarter prepositioning could take place from June. From a fundamental perspective, US 10 Y yields are plunging and US-China trade war is causing a ruckus in the global market pushing equities down. Hence, during uncertain circumstances, NIRP (Negative Interest Rate Policies) currencies are bid. i.e. CHF and JPY which is also considered as a Safe Haven. Apart from this, even the Euro has slight positive / optimism for this month.
Hence, I reckon, until the trade war concern is solved or unless we get a proper outlook or conclusion, we could see the bid in yen flowing in along with Gold appreciating. From a technical perspective, JXY is in a symmetrical triangle and when we consider the seasonal pattern in play, it gives a confluence and bit backing to convince us that the triangle will be broken out to the upside and we could see 105 in the coming months.. which is possible if trade war prolongs.
Apart from this, if we see too much accumulation of wealth in Yen assets, we could also see BOJ could reverse its NIRP fundamental agenda and hypothetically, if we experience this when the yen is strongest among all, then the whole game changes.
Too much volatility ahead. Only those who know to tame this bitch well will be rewarded and pigs will get slaughtered.
