• USD/JPY longs are growing more fearful about renewed intervention since spot broke last Friday's 158.06 high

• Some cash longs switched to options, with 160.00 a popular strike since the initial BoJ decision

• These options can increase in value on continued spot strength and especially if 160.00 breaks

• If BoJ intervene, topside strike options only risk their initial premium, which comes at a discount to downside strikes

• Higher downside strike premiums reflect the markets growing fear of BoJ intervention
USD/JPY 25 delta risk reversals

(Richard Pace is a Reuters market analyst. The views expressed are his own)