The yen has had a rough week, and this strategist says trading patterns suggest the weakness could continue.
It's been a tough few days to own the Japanese yen. A tough week , in fact. And Paul Mackel, head of Asia currency research at HSBC, thinks there are still opportunities to sell.
Not against just anything, though. For starters, Mackel isn't exactly a fan of the dollar. "We're very skeptical, more on the cautious side of things, thinking U.S. growth could start to disappoint," he told CNBC. "We generally have a dollar bearish profile, but its going to be a patience game at the moment. The current popularity of the dollar-yen trade is also making him wary, he says.
Still, the persistent weakness in the yen is a concern for Mackel.
"The price action is changing. Perhaps investors are trying to diversify their funding sources," selling the yen as a funding currency rather than other low yielders like the dollar.
So while he doesn't want to sell the yen against the dollar, "we'd be likely to sell the yen versus Asian currencies," he says. "There is going to be a better opportunity for that over the next couple of weeks."
You can watch the discussion on the video.
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