JPY: Speculators amassed a record gross and net long position - BBH

Research Team at BBH, notes that in the futures markets, speculators had amassed a record gross and net long yen position.

Key Quotes

“The yen's momentum had stalled, with the dollar testing the JPY107.75 area three times. The interest rate differential makes it expensive to hold a long yen position with it trending higher. Without momentum, the late yen longs were in weak hands.

What we suspect is mostly short-covering lifted the greenback above its 20-day moving average against the yen for the first time this month. It is found near JPY110.10 now. The intra-day technical indicators warn that some backing and filling is likely in the North American session. The JPY110 area may offer support. We anticipate better dollar dip buying than we have seen over the last few weeks.”