USD/JPY to target 104 in 1-3M – Danske Bank

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, suggests Chief Analyst, Jens Peter Sørensen at Danske Bank.

Key Quotes

“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.”