21 Jul 2014
JPY traders short covering - BBH
FXStreet (Guatemala) - Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman notes geopolitical tensions often seem to spur yen appreciation.
Key Quotes:
"In the foreign exchange market, geopolitical tensions often seem to spur yen appreciation. Indeed, in recent days, the dollar retested the lower end of its five-month range near JPY101."
"The euro fell to nearly six-month lows against the yen. However, this does not mean people are buying yen, which is what the safe haven concept implies."
"Instead, we think the yen's strength may be more a function of short-covering. This hypothesis is supported by the speculative positioning in the futures market."
Key Quotes:
"In the foreign exchange market, geopolitical tensions often seem to spur yen appreciation. Indeed, in recent days, the dollar retested the lower end of its five-month range near JPY101."
"The euro fell to nearly six-month lows against the yen. However, this does not mean people are buying yen, which is what the safe haven concept implies."
"Instead, we think the yen's strength may be more a function of short-covering. This hypothesis is supported by the speculative positioning in the futures market."