The carry trade has to unwind eventually. Its been going on just way toooooooooooooooooo long. How long do you think you can borrow a low yielding currency to fund purchases of a higher yielding currency.
I read somewhere-can't remember where-that japanese individual investors had been invested in aussie issues and were now bringing the cash back to Japan-thus buying the yen
They also bought a lot of Aussie property. Lots of McMansions on the Gold Coast owned by Japs but unoccupied. Now losing value. So are they selling those and repatriating that money too?
Yen-penny parity before December expiry, a chance good enough to take. Think 7k a car at least. Nimbleness and fortitude needed, and must be willing to ride it down, say, 80 to 125 ticks. But it could be one way, although it looked that way two Mondays ago, too. Either way, a whopping good risk reward. I rate little chance of BoJ intervention either, or if there is, it'll be swamped. Then we see what's out past 1.1. (Godzilla, maybe)
A very unusual trading environment, as all those playing the home game version of ET know. Those who boarded the train with me Sunday evening have seen sizeable retreat from our one way ride in equity and to nice equity, but don't despair. In fact, if ever there was time for an inexplicable move my way (YEN rally rekindled), overnight into coming a.m. would be it. That's merely a sense, because, rationally, if all else points to pause while finality of bailout awaits, then currencies oughta not suprise either. But watch the next 14 hours.