The fear from the tech sell off isn't translating to the currency market
The Nikkei is down by 1.77% on the day, but that's not really dragging yen pairs down at the moment. USD/JPY is higher by 0.17% playing a tug of war at the 105.50 handle - there is a an option expiry at the level to watch out for.
Asian equities are mostly lower on the day as the tech sector is the biggest drag among the major bourses. Hong Kong's Hang Seng index is down 1.35% currently - led by a drop in Tencent Holdings which is down 2.22%.
The bad news for equities is that the pain may still have further to go, if you believe in these things.
But amidst the sour mood in equities, the response in the yen pairs haven't fit that tune. The currency market is either lagging or it just doesn't bother.
There is good news on the North Korean front, but I don't believe it's that major of a development that we haven't heard before in the last month so far.
Yesterday we saw a wild ride in the US session where things basically reversed whatever happened at the start of the day.
And yes, quarter-end flows can do that. So, if you're really uncomfortable with how things are playing out it's best to take a step back and wait for more clarity. There will always be another trade in the market, remember that.
