USD/JPY: Further tactical downside may be limited for now – Danske Bank
|The tactical short USD/JPY spot trade from FX Top Trades 2025, initiated on 13 January, has reached its soft target of 147.00, Danske Bank's FX analysts Kristoffer Kjær Lomholt and Filip Andersson report.
Little room for further downside in long-end US yields
"While we initially intended to keep the trade open and adjusted the soft target to 145.00, we have decided to close the position booking a 5.7% profit, including a negative carry of -0.57%."
"While we still favour short USD/JPY on a strategic basis, the pair has remained steady in the 147-148 range despite declining US yields and risk-off sentiment - typically JPY-positive factors - suggesting that further tactical downside may be limited for now."
"Additionally, in our view, there is little room for further downside in long-end US yields, and as such, we believe closing this trade is the prudent move."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.