WHEN MARKETS TAKE A BREAK from the recent selloff, FX traders pick among USD, JPY and CHF as the safe haven currencies to sell. JPY is hit hardest on a combination of a bounce in Asia and European futures after the Jpns govt urged the Bank of Japan to ease the yen as part of an upcoming stimulus that has yet to be confirmed. Politically, PM Kan is being challenged by senior DPJ officials for the leadership. We have been here beforeJapanese political uncertainty combines with temporary bounce in equitiesFX traders capitalize with short-term longs in yen crosses; thus, EURJPY, AUDJPY and CADJPY facing intermediate targets at 108.30, 75.50s and 80.60s. Such yen shorts ought to be short-term in nature, as traders remain cautious from ahead of todays US jobless claims will they decline from prior weeks giant 500K reading) and Thursdays Bernank/GDP combo. EURUSD still seen retesting 1.2760s.
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