Societe Generale Research revisit some of the August seasonal trades which had performed over the past 20 years.
"We outlined August trade ideas in time to find summer cover and your intuition is right: August tends to be good for the yen, Swiss franc, and gold, and for volatility. The best G10FX trade in August over the last 20 years, is short NZD/JPY. Which is interesting as USD/JPY tests 106 again (it's failed to break this level twice already in the last three months)," SocGen notes.
"Given what US real yields are doing (collapsing, 30yrs at new lows, 10s heading that way) and how gold is reacting to that (going mental) the yen's timidity is striking. We haven't given up on the yen however: A safe haven currency that remains in a narrow range while equities roar higher is doing a great job as long as it does rally when stocks falter. If we do break, two thins follow: one, is that August may well see the yen push stronger in traditional fashion," SocGen adds.