USD/JPY

Kauri said:

The cont is not the best, but at least it's going in the right direction... for the moment...
Cheers
...........Kauri

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wayneL said:

Not good news for the SM if it continues.

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Kauri said:

Am looking closely for a possible short trade... as an old girlfriend used to say.. be patient and let it develop...
Cheers
.........Kauri

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Kauri said:

Helped myself to a quick 50 points odd... watching to see if it develops into a trend as opposed to a rumour blip before committing ..
Cheers
..........Kauri

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reece55 said:

Top trade Kauri, the move in the yen pairs tonight was quite dramatic across the board............ In an hour, the Euro/Yen lost about 100 pips, I am looking for a short on a longer time frame on that pair....

Getting back to the USD/JPY, looks like there was quite sustained selling at 115.90~ level, i'm thinking the pair could potentially test the 111 - 110 level in the coming months..... Ironic however, as the economic data coming out of Japan is less than rosy......

Cheers
Reece

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Nov. 1. With the opening slide in the stock markets, the second wave of risk aversion sales has been seen on JPY crosses. The DJIA is now down 200 pts on the Citi fears and other market downgrades with USD/JPY triggering stops under 115.00/10 for a fall to 114.85/90. EUR/JPY has triggered the stops under 166.00 for a fall to 165.65 with more stops at 165.30 and 164.60 reported.

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reece55 said:

Well, I thought 111 in the coming months, but I didn't expect to already be at the 112 level...

The USD/JPY pair is now at a critical level, if 112 were not to hold (and this is now the second time since Aug we have had a significant test) it will be a rapid move down to 108......

Personally, I highly doubt the Japanese will allow the pair to get much lower - their economy is still in deflation mode and they know the number one important element is to continue to maintain a low exchange rate to ensure their exports remain attractive to their number one consumer - the US...

Cheers

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November 9. Lots of talk about heavy coupon payments coming up soon, and an arcane structure designed for the Japanese market some time ago called PRCDs, Power Reverse Dual Currency notes, the coupon and return linked to performance of USD/JPY; with payment due in Yen (or currency of contract/ choice) based off FX performance. According to the gurus that monitor these types of structured products the "magic" number is 110.00, and we are getting uncomfortably close to there. According to sources the volume of these exposures are roughly 20% less than they were four years ago when they last caused a panic, but they are forcing up L/T vol levels significantly.
US equity markets still remain wobbly and traders are very, very nervous that the rout will turn into a debacle in USD/JPY if 110.00 cedes. Spot was last 110.95/98, the low 110.51, with talk of barrier defence

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November 9. USD/JPY has slipped back down over the past half hour from 111.10 to 110.85 as US equities come under the gun again. There was talk earlier that a ubiquitous, large, semi-official Japanese governmental body was buying big amounts around 110.60/70, which has scared off some of the sellers, and techies note that spot is ranging between the top of the Bollinger band lower limits, and the bottom of the normal distribution channel (111.15 currently) throughout today's session; however the lower Bolly band zone has slipped down to 109.55/110.35 from 109.85/110.60 earlier, which means effectively that it should be easier for USD/JPY to penetrate 110.50 on the next attempt. An option barrier is slated to be there and was actively defended this AM.
Carry trade unwind is the name of the game, and according to senior traders every time stocks top out the cross selling intensifies.

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