GBP/JPY traded as low as 157.70 and EUR/GBP hit .8615 as trailing stops were hit on all GBP crosses. Cable is having trouble bouncing and we may see further losses if the market can hold below 1.6450 into early Europe. It doesn’t look like there have been any major news or announcements today, just the usual profit taking and stop-loss hunting.

At the end of last week, two major investment banks sent out sell recommendations on USD/JPY when it was trading around 96.50/97.00. Most of the justifications for these trades came from the Treasury markets. The market fell quickly down to 94.50 but has rebounded just as quickly back again.

Where to from here? I say higher. My argument is that JPY cross short covering will win the day over fundamental arguments in the short term. Watch for stop losses above 97.50 in USD/JPY and for more if the market gets back above the top of Ichimoku cloud, now at 98.10. An interbank dealer friend of mine tells me the market is quite short USD/JPY and I think it’s going to be caught out.

A bit of early profit taking on EUR/JPY sent the pair from 136.80 to 60. As Jamie reported earlier, Sovereign demand was noticed on dips in the EUR/USD to 1.4150 during the NY session with tight trailing stops now expected below 1.4140 in case the bids don’t materialise. Heavy EUR/JPY stops are noted above 137.75.

Some speculation that there may be a very short tern no-touch at the figure but no confirmation as yet. Selling has been fairly heavy between 80/95 and do not be surprised to see a squaring up as we head into the London session.

Early Tokyo is doing its’ usual trick of booking profits after decent overnight moves. USD/JPY has fallen from 97.00 to 96.60, with next support being the NY low at 96.50.

EUR/USD is up to 1.3950, but sales of EUR/JPY and standing orders above the market, are weighing.

I have been waiting for this EUR/JPY move to start up again and I believe it started yesterday. Don’t be looking for fundamentals here, it’s simply that the market is bearish, short and the big flows are buying rather than selling. Once the major players start chasing it we will see levels above 140 and perhaps even close to 150. If you’re bearish, my view is that you should take a 3 week break. I also think we will see AUD/JPY up towards 80/85 and that’s where I start re-building long term shorts!

On the day, USD/JPY has some decent technical resistance at 97.20 where the market stalled overnight. Support is at 96.50 and this range should contain early trading. EUR/USD is in a bullish phase with short/term parameters at 1.38/1.4050 and more medium term parameters at 1.3650/1.42. EUR/GBP didn’t manage a second daily close below the 200-day MA and the market smells short to me. There is strong AUD/USD selling expected on the approach to .7900/25 and support is firm with Sovereign buying on dips towards .7700.

Good luck today.

Bids at 1.3810 are limiting any falls in the EUR/USD and the USD/JPY buying is showing no signs of letting up, currently chewing through offers around 96.25/40 region. This all means some really healthy gains for EUR/JPY with the cross now at 133.25, up from 131.70 in early trade, and headed for what are said to be very heavy stops above 133.75.

Dealers expect to see bids appearing from either the Swiss National Bank or the Bank for International Settlements if EUR/CHF dips back towards 1.5050.

I’m hearing that for the last three days, Japanese retail accounts have been getting increasingly short on the JPY crosses, EUR/JPY in particular. I’m not sure what is behind this selling but the information comes from a reliable source in a Japanese bank.

Reiterating what Jamie said overnight and I’m hearing the same information from dealers. The stops are staggered from 95.55 up to 96.15 and the only surprise is that they haven’t gone off sooner.

• 1
• 2
• 3
• 4
• 5
• ...
• 93
• >