USD/JPY: USD/JPY and yen crosses has been steadily heading lower, driven by risk aversion on back of political uncertainty in the Eurozone. We have been better sellers for the last 24 hours and would assume this downtrend in spot to continue today, especially with UST 10y yields just above 2.00. USDJPY does not have much on the way down to 117.93, a Fibonacci level, 117.67, the 50-day moving average, and the big support at 115.50.
EUR/USD: EUR/USD traded slow overnight compared to yesterday but there was plenty of action elsewhere. The US dollar was under pressure, driven by USDJPY. Spot opened just below yesterday’s high in Europe and while it is likely to test 1.2000 sooner or later, the overall trend is intact. Stay flexible and fade 40-50pip moves in either direction with stops at 1.1860 and 1.2060.
AUD/USD: As the USDJPY selloff is driven by risk sentiment, we expect AUDUSD to run out of steam eventually and prefer to be short here with stops above 0.8225.
UBS