The game behind BOJ intervention, USD vs JPY

For goodness sake, stop being paranoid about intervention or no intervention from BOJ.

Just focus on the chart and trade accordingly.

The last time usdjpy futures had a rather big range was on
28 Jul 2023.

Other than that, it could be the
bucket shop doing funny things / playing some games.
 
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maxinger said:
For goodness sake, stop being paranoid about intervention or no intervention from BOJ.

Just focus on the chart and trade accordingly.

The last time usdjpy futures had a rather big range was on
28 Jul 2023.

Other than that, it could be the
bucket shop doing funny things / playing some games.
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You're right.
 
You are so damn right!

This is the same reason I have avoided trading the USDJPY in the last few weeks. It’s not clear whether this bullish trend will continue, but there is no signal at all that a reverse is possible as well.

On the other side if you switch to GBPJPY there is a more clear picture. In fact, the price here is ranging, but still, it provides better opportunities for traders hooked up on the Japanese Yen pairs. Here I think the downtrend is more possible in the next two weeks or more.

Anyways, the news of BOJ will decide whether the downtrend will happen at all. Until that probably the price will range around the current level.
 
Mesida said:
You are so damn right!

On the other side if you switch to GBPJPY there is a more clear picture. In fact, the price here is ranging, but still, it provides better opportunities for traders hooked up on the Japanese Yen pairs. Here I think the downtrend is more possible in the next two weeks or more.
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If you think GBPJPY will trend down and USDJPY might stay flat then you simply believe that GBP will weaken. In that case you're better off trading short GBP against other pairs not JPY to avoid high daily financing costs.
 
tsfx said:
Hey,

So markets collectively seem to be in this waiting game to see whether BOJ is having 150 as the ceiling price of USDJPY and at the same time anxiously waiting for that free money the central bank will give to every trader that is long the JPY. And there are plenty. Every sentiment gauge is telling that everyone is max long JPY.

But why is BOJ referring to the weakness of JPY while it's actually the strength of the dollar? :)

Look at the attached chart. If you remove USD from the equation and just look at the JPY against other majors you'll notice that JPY has actually been flat for over 5 months now. It's the USD that has gone straight up.

So, that's just an alternative look at things. If you want to be short USDJPY, just be short USD somewhere else, say against a high yielder like GBP or NZD. In that way you don't lose -5% + broker mark up while waiting. It's the USD, stupid. Cheers.
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Good strategy for past bro. It's same like pointing to support resistance levels from past price action and recommending to trade them. Nobody can guarantee that fundamentals for Yen won't changing especially since BoJ clearly lags behind other peers and can announce policy changes in December.
 
kroxobor said:
Good strategy for past bro. It's same like pointing to support resistance levels from past price action and recommending to trade them. Nobody can guarantee that fundamentals for Yen won't changing especially since BoJ clearly lags behind other peers and can announce policy changes in December.
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What are u talking about?
It's nothing like a S/R level strategy, in fact, i didn't even describe a specific strategy in that post. I just suggested to change the JPY for a high yielder when trading short USD because of overnight funding reasons. It's working perfectly right now. And if JPY starts to strengthen for whatever reasons then this will still lead to weaker USD which means you still benefit from being short USD.

Being short USD against JPY costs you like 70+ points per month when holding it PLUS broker mark up. So, when you hold a short for a year and USDJPY drops 1000 points you'd be break even at best.
 
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tsfx said:
The way the market tries to tell you that there's a ceiling at 150, so that you keep accumulating short positions and put stops above this level :) (chart attached)

I wonder how many remember the Swiss central bank intervention intention in EURCHF back in 2015.

When you're short you can't use stops now, because if it blasts through it can leave a nasty gap up. 152 was the last time there was an intervention so keep an eye out for that level as well.

View attachment 325662
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There are your stops. From those who thought 150 was protected.
 
tsfx said:
There are your stops. From those who thought 150 was protected.
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not trading this right now given the impending fireworks likely to be set off anytime by the whims of some bureaucrat in Tokyo, but i expect after the drama is over, we'll hear stories of more hedge funds getting caught offside lol

somehow there are always those willing to bet the viability of their entire fund for some 50 bps of marginal return
 
pinetboltz said:
not trading this right now given the impending fireworks likely to be set off anytime by the whims of some bureaucrat in Tokyo, but i expect after the drama is over, we'll hear stories of more hedge funds getting caught offside lol

somehow there are always those willing to bet the viability of their entire fund for some 50 bps of marginal return
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That move 150 increased options prices like mad. Bets on volatility have increased making actual possible volatility less likely now :)

Slowly but surely there's growing attractiveness in long SP500 / long yen structure. SP just might close that 4050-4000 gap first.
 
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