Friday 27 September: JPY strength

A surprise election result in Japan caused a surge of JPY strength, as the incoming prime minister leans more hawkish than the market was expecting. Which potentially puts us back to square one regarding the yen, just when it appeared 'short JPY' would be the go to trade for a while.

My 'hope' is the JPY strength is a flash in the pan and next week 'short JPY' trades will resume... We'll see.

The news from Japan, coupled with quarter end, does mean any thoughts of a trade today have been sidelined for me as I feel it's prudent to let the dust settle.

In other news, US core PCE data is reported today, a few months ago it was the most important data release, but today, as long as there isn't a huge 'upside surprise', 'risk on soft landing trades' should still be on the cards next week. Whether or not that includes the yen, time will tell.

Feel free to email any questions: johnelfedforexblog@gmail.com