User Name: Password:      Register - Lost password?

Forex Forum     ← Back to Threads

Sort Order: Latest Post on Top - Latest Post Last            Post Reply

GVI Forex Jay  13:49:41 GMT - 03/18/2011  
I started this thread as a place where you can ask any questions about intervention or discuss it in detail.

Knoxville jc  14:36:52 GMT - 03/18/2011  
Sorry for the dumb question, but when the Fed sells JPY for USD, where do they get the massive amounts of JPY to sell?

New Haven CT RR  14:50:54 GMT - 03/18/2011  
How does the BOJ intervene? Does it just print yen to sell and buy dollars in exchange and then buy Treasuries?

GVI Forex Jay  16:51:03 GMT - 03/18/2011  
jr, no question is considered dumb.

The Fed has swaps lines with the Bank of Japan. When it buys dollars and sells yen for intervention, it swaps the dollars with the Bank of Japan for yen. So in the end the Bank of Japan supplies the yen.

The alternative would be to sell yen out of reserves but more likely it is being done on behalf of the Bank of Japan and thus swap lines are used.

I hope that is clear.

GVI Forex john  17:06:25 GMT - 03/18/2011  
RR- The BOJ is selling JPY which they have printed for USD. In the past, they usually they have "sterilized" their intervention. That means they sell Japanese bonds to absorb the excess JPY. Intervention works best when it is unsterilized. In any case they have to do something with those billions of USD, and so they buy U.S. Treasuries.

Hope this is not too technical...

GVI Forex Jay  17:53:07 GMT - 03/18/2011  
I posted this earlier on GVI Forex It is important to understand as this is why the spot market often moves when one currency pair is trapped in a tight range and crosses move.

GVI Forex Jay 11:55 GMT March 18, 2011
Cross Trading 101: Reply
USD/JPY has struggled moving higher so for jpy to weaken on its crosses, offsets have to take over and push the dollar lower elsewhere, which is what has occurred.

I assume this is not what the G7 had in mind when it agreed to joint intervention.

GVI Forex Jay  10:33:34 GMT - 03/25/2011  
Note how the BOJ putting a floor under USD/JPY has given the market a green light to sell JPY on its crosses for a carry trade.

As posted on the Forex Forum today:

London Mick 10:25 GMT March 25, 2011
EUR and JPY: Reply
All the BoJ has to do is hold the line until after March when seasonal pressures will end and make it easier to put a floor under usdjpy.

London ex 10:22 GMT March 25, 2011
EUR and JPY: Reply
Looks like there is some USDJPY demand today. I have to assume that Tokyo is in behind the scenes giving it a lift. Can't really trade USDJPY with Japan putting in a solid floor but market flows seemingly going the other way.

Retail Forex Traders Association

Monthly FREE: Forex Newsletter, Special Reports, Webinars. and more. Join now

  Take a moment and check out what our sponsors have to offer by clicking on their ads.

Test Drive a Better Broker

forex brokersNEW! Global-View best brokers list section.  ASK US. for info.

Best Brokers List

  Alpari Forex


CMC Markets

Forex Services -- Free Trials

Global-View offers a full slate of currency exchange services. 

  • Real-time forex signals for trading. 

  • Trading Analysis and currency trading tips.

  • FX charts and live forex news.

Free trials  Forex (currency trading) Services

Currency Trading Tools

  • Live rates, currency news, fx charts. 

  • Research reports and currency forecasts.

  • Foreign Exchange database and history.

  • Weekly economic calendar.

Directory of  Forex trading tools


Forex Forum
Forex Trading Forum
Forex Forum + forex rates
Forex Forum Archives
Forex Forum RSS
Free Registration

Trading Forums
Currency Forum Guide
Forum Directory
Political Forum
Forex Brokers
Compare Forex Brokers
Forex Broker News
Forex Broker Hotline

Forex Trading Tools
Currency Trading Tools
Forex Database
FX Chart Points
Risk/Carry Trade Chart Points
Economic Calendar
Quicklinks to Economic Data
Currency Futures Swaps
Fibonacci Calculator
Currency Futures Calculator

Forex Education
Forex Learning Center
FX Trading Basics Course
Forex Trading Course
Forex Trading Handbook

Forex Analysis
Forex Forecasts
Interest Rate Forecasts
Central Bank Forecasts

FX Charts and Quotes
Live FX Rates
Live Global Market Quotes
Live Forex Charts
US Dollar Index Chart
Global Chart Gallery
Daily Market Tracker
Forex News
Forex Blog
Forex News
Forex Blog Archives
Forex News RSS
Forex Services
The Amazing Trader
Forex Opportunities
Forex Affiliates
Forex CopyTrading
GVI Forex