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USD/JPY Discussion

Quoting funzodundee
{quote} Its difficult to time but I see it trending down for the rest of the month. If a poor PPI number prints today then yields and USD/JPY will both fall so it may hit our target sooner.
The PPI was positive but the trend it seems is still bearish.
Quoting funzodundee
{quote} Bond prices are RISING which means yields are falling. Surely you knew that?
Which bond prices are rising? Can you show me on the chart you’re looking at?
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Learn, a forex trader must, unlearn and relearn he will.
Quoting COGSx86
{quote} And what does demand do in the bond market? Drops price, right? So if bond prices are dropping and the US is giving away free money to allow the US stock market go up and your a foreign investor in Japan who lives in a stagnate/ deflationary economy, where you going to put your money?
Gold
Quoting COGSx86
{quote} Which bond prices are rising? Can you show me on the chart you’re looking at? {image}
Firstly, $usdjpy plummeted as I'd hoped.
The chart you put up IS BOND YIELDS.
Which fall when bonds rise.
Do you really not know this?
Quoting funzodundee
no fancy charts, just common logic. We seen one of the highest demands for 10 year treasury bonds yesterday. This will drive yields down for certain. As yields have a high correlation with usd/jpy we have a great opportunity to short. Short usd/jpy to 108.70
yields dropped on friday and will continue to trend down.
$usdjpy fell in line with yields
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Quoting stevanuss
{image}
long or short ?
An intresting bit of recent. history.
The last time there was such a huge demand for bonds was in March 2020.
I should say ALMOST, as Thursday's auction was the highest, in history.
Now to clear up any confusion:
Bonds go up and the bond yield goes down.
They have a 100% inverse correlation .
The yield is highly correlated to USD/JPY.
In March 2020 USD/JPY fell to 101.20 as yields nosedived.
The bond market is rarely, if ever wrong and Im not saying USD/JPY will fall that far, but it will fall hard.
Consult your fancy charts and trade accordingly but I see no other way than down.
This also provides opportunities to short financial stocks and buy TLT etf as the bond value will rise(yield will fall)
Remember - Bond value up = bond yields down
Quoting izzas
{quote} long or short ?
I was Short, and get in another when bar have Cross
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Quoting stevanuss
{quote} I was Short, and get in another when bar have Cross {image}
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Quoting funzodundee
An intresting bit of recent. history. The last time there was such a huge demand for bonds was in March 2020. I should say ALMOST, as Thursday's auction was the highest, in history. Now to clear up any confusion: Bonds go up and the bond yield goes down. They have a 100% inverse correlation . The yield is highly correlated to USD/JPY. In March 2020 USD/JPY fell to 101.20 as yields nosedived. The bond market is rarely, if ever wrong and Im not saying USD/JPY will fall that far, but it will fall hard. Consult your fancy charts and trade accordingly...
nothing to do with bonds, but the possibility of operation Afghan Storm 2.0 after president of Afghan fled e country on sunday. impulse move IMO
Quoting Bicarus
{quote} nothing to do with bonds, but the possibility of operation Afghan Storm 2.0 after president of Afghan fled e country on sunday. impulse move IMO
What frightens me is that you have subscribers who may be influenced by you.
That is the most ridiculous answer I have ever heard
Quoting funzodundee
An intresting bit of recent. history. The last time there was such a huge demand for bonds was in March 2020. I should say ALMOST, as Thursday's auction was the highest, in history. Now to clear up any confusion: Bonds go up and the bond yield goes down. They have a 100% inverse correlation . The yield is highly correlated to USD/JPY. In March 2020 USD/JPY fell to 101.20 as yields nosedived. The bond market is rarely, if ever wrong and Im not saying USD/JPY will fall that far, but it will fall hard. Consult your fancy charts and trade accordingly...
The easiest way to put it that most people understand is that if people are fleeing to safe haven investments they are purchasing bonds causing yields to go down.

There's "demand" for bonds.

That's what qe is and how the fed keeps rates low. They're purchasing bonds.
"A true speculator tries the market small." - Jesse Livermore
Side note. 109 -108.75 has been a safe buy and really this sell off isn't being driven by fundamentals.

Also most major investors/traders have an eoy target of 113/115.
"A true speculator tries the market small." - Jesse Livermore
  • Post #84,015
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  • Edited Aug 17, 2021 12:22am Aug 16, 2021 11:12pm | Edited Aug 17, 2021 12:22am
Quoting funzodundee
{quote} What frightens me is that you have subscribers who may be influenced by you. That is the most ridiculous answer I have ever heard
whats frightening is you equating bond auctions results, macroeconomics, directly to spot fx movements.
not saying there is no co-relation. but there are many other financial instruments that should be affected by bond auction due to their direct relations before spot FX which is at back of line.

see next post
  • Post #84,016
  • Quote
  • Edited Aug 17, 2021 12:32am Aug 16, 2021 11:52pm | Edited Aug 17, 2021 12:32am
Quoting Jgcole83
{quote} The easiest way to put it that most people understand is that if people are fleeing to safe haven investments they are purchasing bonds causing yields to go down. There's "demand" for bonds. That's what qe is and how the fed keeps rates low. They're purchasing bonds.
1) "people are fleeing to safe haven investments they are purchasing bonds" - not true.

explainer: most bonds are purchased by Asset Managers (AMs) that are sitting on a ton of cash. instead of letting the cash sit idle in the bank they purchase bonds to earn the meager yield till they know what to do with it.

judging off indexes, which are all at all time highs, many AMs are not willing to get into it now(akin to buying the top). hence they are sitting on tons of cash and turn to bonds.



what i'm saying:
the next time indexes sell off. yields will rise because AMs will exit the bond markets and buy the index dips.


what you're saying:
the next time indexes sell off. yields will drop because it is risk off and more people are flocking to bonds as "safe haven".



you and @funodundee, watch this space we'll address this post again when indexes sell off.


2) Are we in risk off mode now? - No

explainer: Indexes are the leading indicator for Risk on/off.
Yet:
a) Indexes are at all time high
b) VIX is normal, no abnormal short coverings
c) Other Risk sensitive instruments are all within Standard Deviation.



3) Why the Yen Strength? - multiple factors in play but definitely not because of Bond auction.

explainer:
1) market spooked because of Khabul's fall within 72 hours of Biden saying it would take the taliban 3 months at least
2) Japan minister announced US$400 BILLION relief package
3) market makers were preparing for end of month settlement and clearing of book
USD/JPY

https://twitter.com/Market5tudio/sta...56054418317348
not euphoria follower
Quoting Bicarus
{quote} 1) "people are fleeing to safe haven investments they are purchasing bonds" - not true. explainer: most bonds are purchased by Asset Managers (AMs) that are sitting on a ton of cash. instead of letting the cash sit idle in the bank they purchase bonds to earn the meager yield till they know what to do with it. judging off indexes, which are all at all time highs, many AMs are not willing to get into it now(akin to buying the top). hence they are sitting on tons of cash and turn to bonds. what i'm saying: the next time indexes sell off. yields...
The only thing I said is it's traditionally seen as a safe haven.

Common sense tells you that am's are buying the dips, but that's because there's really nowhere else to put your money with yields as low as they are.

Everyone already knows this. It's not some big secret.

You're looking way to deep into a simple comment.
"A true speculator tries the market small." - Jesse Livermore
Quoting Jgcole83
{quote} The only thing I said is it's traditionally seen as a safe haven. Common sense tells you that am's are buying the dips, but that's because there's really nowhere else to put your money with yields as low as they are. Everyone already knows this. It's not some big secret. You're looking way to deep into a simple comment.
my reply is directed at funzo that accredited yen strength to bond auction
Another wonderful opportunity to SHORT USD/JPY.
The high correlation between this pair and bond yields which will continue to drop.
Every rally should be shorted for the foreseeable future.
FOMC tonight WILL drop USD/JPY.
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