EUR/JPY: Selling the pair is Citibank's suggestion of the week

In a note published today, Citi shares its preferred trading idea for this week, selling the EUR/JPY:

"The JPY remains vulnerable to changes in risk sentiment. In addition to  demand for JPY as a safe haven, foreign investors investing in Japanese bonds are forced to buy the JPY as the Nikkei declines. Given the mixed impact of the last NFP report and the Chinese market reopening after a long weekend, there is potential for positive volatility in the JPY.

In this context, the EUR/JPY seems to be a good vehicle to play an upward JPY movement (selling EUR/JPY), especially as the ECB's dovish stance should continue to weigh on the EUR.

We therefore recommend selling the EUR/JPY at 132.75, with a target of 130.15 and a stop loss at 134.15."