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20 Apr 2015
USD/JPY: ‘Sell in May’ sentiment would be good chance to ‘buy more in May’ – DB
FXStreet (Barcelona) - Taisuke Tanaka, Strategist at Deutsche Bank believes that US economy might rebound in Q2, and suggest any weakness in USD/JPY to be used as a buy opportunity.
Key Quotes
“The USD/JPY has dipped to around ¥119 on the recent weakness in US economic indicators. We expect a rebound in the US economy in Q2, but it may take more time before this is confirmed in actual data. The USD/JPY may stay in corrective tone during that period.”
“Meanwhile, the Japanese economy looks to continue its slow but steady uptrend. Wage hikes have also emerged from spring labor negotiations. The trade deficit is narrowing thanks to higher exports and cheap oil. March trade data on Wednesday could reveal the first surplus in 33 months (while in NSA).”
“Positive news on the Japanese economy may be taken as yen-bullish. However, it should be noted that cyclical risk-on phase usually tends to bring weakness of the yen as a creditor’s currency.”
“Any delay in a recovery in US indicators could prompt fears of a "sell in May" movement in the markets. In such case, we would advise Japanese investors to adopt a "buy more in May" stance and purchase on weakness in the USD/JPY in unless they have seriously doubts over the US economic outlook.”
Key Quotes
“The USD/JPY has dipped to around ¥119 on the recent weakness in US economic indicators. We expect a rebound in the US economy in Q2, but it may take more time before this is confirmed in actual data. The USD/JPY may stay in corrective tone during that period.”
“Meanwhile, the Japanese economy looks to continue its slow but steady uptrend. Wage hikes have also emerged from spring labor negotiations. The trade deficit is narrowing thanks to higher exports and cheap oil. March trade data on Wednesday could reveal the first surplus in 33 months (while in NSA).”
“Positive news on the Japanese economy may be taken as yen-bullish. However, it should be noted that cyclical risk-on phase usually tends to bring weakness of the yen as a creditor’s currency.”
“Any delay in a recovery in US indicators could prompt fears of a "sell in May" movement in the markets. In such case, we would advise Japanese investors to adopt a "buy more in May" stance and purchase on weakness in the USD/JPY in unless they have seriously doubts over the US economic outlook.”