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Forex Flash: Re-open long USD/JPY in cash - JPMorgan

FXstreet.com (Barcelona) - JP Morgan's mid-term bearish view on the JPY remains intact, says Junya Tanase, FX strategist at the bank, noting that "recent news flow has been supportive of this case, therefore, we have reopened a USD/JPY short position."

Junya adds: "One notable development for USD/JPY is the sharp decline of the correlation between the pair and US-Japan yields spread after the unprecedented BoJ easing on April 4. USD/JPY’s beta to the move in US-Japan spread has also declined significantly, suggesting downside risks to USD/JPY would be limited even if US activity data this week surprises on the downside and/or a dovish FOMC heightens downward pressure on UST yields. Stabilization of the political situation in Italy, which should be supportive for risk markets, is also negative for the JPY."

Forex: EUR/JPY closes slightly higher as recent trading range continues

The EUR/JPY traded in a narrow range, but managed to close the day slightly higher up 32 pips at 128.09. Earlier in the session Industrial Production (-7.3% actual vs. -7.2% estimate) and Retail Trade (-0.3% actual vs. 0.5% estimate) were both released, with very little reaction to the numbers and the pair currently up 13 pips at 128.22.
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