One final note and I will stop obnoxiously clogging the forum. My opinion carries a little weight. It is important to remember I know what it is like to run a national bank program at a headquarters with 726 employees covering $16 billion in assets and was the star of the show in some respects eventually. Have seen a thing or two. Also, I have found a few of you “youtube gurus and forex guru’s out their claiming to have backgrounds stealing my commentary from this and other places. Please do so with care and responsibility, and your own input as well, thank you.
MoF/BoJ are likely waiting for this week’s pivotal US data to conclude and resulting price activity to answer the question of whether to intervene or not. The bottom line, if I were a bank VP, is the Yen simply must begin to appreciate for the good of the Japan economy. I believe it will see 150 region inevitably but that is months down the road, so then if you are on the trade the problem to solve becomes efficient scaling in and out along the way (your boss is happy and the bills are paid if you are taking profits). That is where the endless intra-day battles you endured sharpened your skill levels and you can be pretty good at it.
With reference to the Euro comment and where to position, that is for longs (closer to the low end of a big figure). If going short, you want to make the throw closer to the high end of a big figure. Same for Intra-day (.8 vs .2 or just go .5 to make sure you are in the trade). I am only so confident in the Euro economic performance looking out, and the US is beginning to breathe heavy a little, so being long Euro/stocks is a bit dicey from here but barring something profound the train should keep rolling.
Precision and an awareness of fundamentals both matter.
The one I am having issue with is the Euro long due to the price taken. Ordinarily it is preferable to take a price closer to a lower level of a figure not a higher level. Then there are those times you don’t want to be late on the throw and risk it if you see the receiver breaking and take the hit while the ball is in the air (US quarterback talk). Jay was a sportsman and on occasion refers to such analogies. Well, ball is in the air. If you are new to this in forex, especially in spot Forex, it really is like that a lot of the time. This business is not picking daisies.
Shorting UsdYen 106.50 to hold and the buy side of Euro from 0665 to hold with the understanding, especially with Euro there could be a bit of a delay and a bit of a grind that causes one to be patient. Looking for the 156 region for UsdJpy. See stocks staying bid overall despite a bit of economic slowing and recent outflows.
In a year supposedly filled with central bank interest rate cuts around the world, the prospect of another G10 policy tightening amid fresh strains of stubborn inflation is just a bit jarring.
With U.S. markets anxiously awaiting Friday’s update on the Federal Reserve’s favored PCE inflation gauge, Australia’s dollar jumped 0.5% overnight after inflation there unexpectedly accelerated to a six-month high of 4% in May with core price up for a fourth month.
USDX DAILY CHART – USD PROXY
Normally I loon at the USDX as a EURUSD proxy (57.6% of the index) but this time it is moving up because of USD strength with the currency up vs. all majors except the AUD (which is off its post-CPI high).
Looking at the chart, major resistane is 106.60 and for it to be seriously challengerd, EURUSD would probably need to at least take out 1.0667 and 1.0650.
USDJPY DAILY CHART – LAST LINE OF DEFENSE
What can I say?
Will the MoF/NoJ defend 160.16 or not?
As I have noted, if I was in the BoJ’s shoes, I would let stops get run above 160.16 and then come I hard with intervention but my feet are too small to fit into its shoes.
AboVe 160.16 there is a black hole that goes back over 34 years.
GBPUSD 4 HOUR CHART – WINNING STREAK BROKEN
With the GBPUSD 9 candle winning streak broken after a failure to regain 1.27+, attention shifts to the 1.2621 low, but only if it can establish below 1.2669.
With that said, GBPUSD is a laggard as it gets support from various crosses, (EURGBP lower, GBPJPY higher).
This comes in the year of elections where the UK vote is so far not having much impact. Here is an article in this regard
AUDNZD DAILY CHART – ANTHERTWINNER IS…
How do we know when a cross flow is driving the spot market?
One clue is when two related currencies move in opposite direction.
This is the case with the AUDUSD (higher) and NZDUSD (lower)
Key resistance next at 1.0944, blocks a move to the maor 1.0997-1.1030.
Expect support on dips while above 1.0840-90, stronger if above the top of this band.
AUDJPY DAILY CHART – A WINNER IS…
AUD up after hotter CPI (scroll down to see an AUDUSD chart posted pre-CPI).
AUDJPY has been a winner, extending its winnig streak to 9 days and trading in unchartered waters with no clear resistance other than the new high.
Cross offsets are one reason USDJPY is pressing towards 160.
Expect a buy the dip on any decent retracement unless 103.58 is broken..
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