From the FXWW Chatroom – Resilience in USDJPY was seen today as Japan turns out to be net good buyers. Despite the sharply deteriorating risk sentiment across the region, several test sub 105.80 turns out to be false ones so far.
Plethora of buyers from onshore, in bits and pieces. J-retail, small and medium inv, and J-importers who can access long dated FX hedge (in buying USDJPY) given still solid rate diff thus fwd points to afford them sub 100 mark in 2yr+ horizon took this dip as an opportunity. It was then followed by solid demand to see 106.35.
Having said that, underlying weakness in XXXJPY is intact, keeping USDJPY bounce limited. Thus would like to see how this supply-demand dynamics changes tomorrow when we walk in, in relations to overnight spot move.