USDJPY testing strong support at 98.50

Low so far 98.52 ahead of strong buying interest at 98.50

A break of this level should trigger stops down to 98.30 area

EURUSD testing strong sell interest at 1.3300 in a general USD sell-off with AUDUSD also challenging the sellers ahead of 0.9300.

Cable trying to keep up with it all at 1.5393.

Add: I take it back ! I did the pair an injustice. cable just jumped through 1.5400 dragging EURGBP back down to 0.8628

Author: Mike Paterson

Mike Paterson has more than 30 years of experience trading FX including as a senior trader with UBS and Credit Suisse. He was also head of FX at the State Bank of Victoria. With sizeable daily trading volumes Mike carved out a name in the market combining professional integrity with a cynical grasp of seizing market opportunity. Since leaving the City, Mike has been working as an independent consultant and trading along with presenting seminars and writing for a number of publications. Mike lives in Kent and supports Southend United FC.

17 Comments

  1. The best thing do is to sit aside and watch because I don’t know about anybody else but for me, this market does not make sense at all. We were told Yen should weaken with improvement in the Japanese economy. The numbers from Japan are showing exactly that and yet Yen’s rocketing. Heaven only knows what would have happened if Abenomics was shown not to be working!!

  2. and today is the expiry of our bet Chief. I sold you at 115 if you remember a month ago ! as I said in the expiries post earlier, i hope you managed to trade yourself into a better position.

  3. If you can explain to me the sense in these markets Mike, then I’ll be happy to pay you!! :-). The market said if Abe delivers, they’ll the sell Yen. Abe has delivered;…..

  4. I wasn’t looking for any payment Chief.. you just seemed so adamant about it that I felt obliged to challenge! No one ever said FX markets have to make sense. I’ve been in it for 30 years and now is no different from when I started. It’s down to flows. not rationale. not even the black boxes can stop that!

  5. and the market did sell yen after Abe got his way .. but that’s not to say they have to sell for ever.weaker yen should help economy which it appears to have done in the early aftermath. so naturally yen will be bought again. and therein lays the paradox

  6. Agree with you Mike..

  7. Of course I know you weren’t expecting me to pay!! You got waaay more FX dosh than I have!!
    But all things aside Mike, are you not a little surprised that USDYEN is not higher than it is now?

  8. Chief, you’ve also got to realise that Japan and the US are in a unique situation. A lot of Japanese companies operate in the US (and globally) so if the US isn’t doing so well then they are going to suffer = USD/JPY negative. While Abenomics is mainly a plus for USD/JPY he has such a huge job to do domestically that this may keep pressure on USD/JPY rising.
    At this exact moment in time the focus is on what is happening in the US and that is what is driving the price. Japan is playing second fiddle to some aspect.

  9. PHEW!!!
    I’ve just checked my dairy!!! We both got it wrong!! you said 105 and said 115. So you pay me and I’ll use the change to pay you back!

  10. nope. i have said for a long while now that I was/am a happier seller than buyer., everyone was talking it so much higher after the big rally .. had to be time to sell!

  11. The dxy is through the 50% of { 78.55-84.75} and the 200 day avg is coming up here @ 81.48. If that goes things could get really ugly for usd/jpy.

  12. I don’t recall the specifics Chief. Did you offer an either or and I plumped for the lower call? I thought it was just a straight sell. Either way I hope you managed to claw some money back on your 102 possie

  13. my 102 is still in play Mike. it’s just more sentimental than anything else as USDJPY has served me very well this year so I wanna remain ‘loyal’ to it. I guess I won’t be so fond of it if it started going back to the 70s and 80s again lol

  14. sentiment is not a good basis for trading Chief but I’m glad the pair has served you well overall. We all have to wear some pain sometimes.

  15. I agree Mike. The sentiment bit of my trading is always the bit that lets me down. But I’m working very hard on it although on the evidence of usdjpy it doesn’t appear I’m getting anywhere fast!!

  16. lol Chief.. be strong !

  17. Chief. Try to become neutral about all pairs if you think you can get into that mindest. By this I mean whatever is going up buy and whatever is going down sell and don’t be a bear or bull for emotional reasons. Of course, we all have different temperaments so if being a contrarian like Mike works then stick to that. Yen strength isn’t that puzzling if you bear in mind what Ryan stated. Also: correlation, correlation, correlation. For example, you noticed the tremendous rise in the Nikkei which correlated with the rise in USDJPY right? So now that the Nikkei is faltering and going down what’s the conclusion? As Mike says, its to sell USDJPY and other Yen crosses. It really isn’t that puzzling.

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