EUR/JPY's big move today may just be the start...I'm eager to hear thoughts on this topic.
The 'text' box in the chart says it all.
JPY continues to be the 'safe haven' currency in market-mayhem episodes, just like we're seeing today as the equity markets crater. Add to that the 'ol "carry trade" effect...Yen has been the currency of choice for carry-traders, borrowing in Yen at near zero interest rates (NZIR) and investing almost anywhere else at higher rates. That party comes to an end, likely, the minute the Yen starts appreciating, which could happen as these trades begin to be unwound in the face of pain in other markets (read: margin calls!), and/or as the BOJ starts to fade on its Near Zero Interest Rate policy due to rising inflation in what is, other than the auto sector, a heavily import oriented society! Either way, the current weakness of the Yen will likely be left in the rearview mirror.
I invite commentary and discussion on this, as thoughtful views will touch on both the fundamentals from a global-macro perspective and technicals.
(DISCLAIMER: This is NOT advice in any way, not by intent nor by suggestion! It is solely educational and entertainment content.)