Higher for longer narrative takes hold.

There is a mildly negative sentiment in the air as the VIX rises above 14, bond yields are climbing and the S&P is negative as a realisation that a US cut may still be a little further away than hoped. And it's a narrative that's unlikely to change until US GDP and PCE either confirm 'higher for longer', or, in an ideal world, some 'soft data' could flip the story and see a resumption of the 'risk on soft landing narrative'.

For me, 'higher for longer' should still = short JPY. And there is a case to say a USD JPY long is an option today.

But, personally, I don't quite have enough conviction, so I'm going to sit on the sidelines and await tomorrow's GDP data.

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