EURUSD

Sarkozy and Merkel did it

Nailed the 61.8 to boot. Lets see...

LONDON (Dow Jones)--Who's next?
That was the question reverberating through the financial markets after Standard & Poor's unexpected announcement Thursday that it is downgrading Japan's credit rating to AA- from AA.
The announcement, prompted by the continued deterioration in Japan's fiscal position, suggests that rating agencies have now moved on from the sovereign-debt crisis in Europe and are starting to focus on the structural debt problems facing other major economies.
The ratings agencies aren't the only ones putting debt center-stage.
In his State of the Union address earlier this week, U.S. President Barack Obama launched plans to start putting a cap on the U.S. deficit, a big reversal from his administration's previous free-spending policies.
In the U.K., the cost of addressing the public deficit also came into sharp focus this week when GDP figures for the fourth quarter of last year showed a sharply contracting economy.
Although the credit agencies have already cut the ratings of many euro-zone debtors, in the case of some 'peripheral' countries all the way down to junk, there still remains the risk of further cuts.
Let's face it, current rescue plans are aimed at helping these euro-zone countries continue to service their debt, not necessarily reduce their overall levels.
S&P has had Japan on negative credit watch since this time last year.
With the country buckling under a debt-to-GDP ratio up at 170% even before the start of the recent financial crisis, and with deflation still posing a problem after years of easy monetary and fiscal policies, the Japanese economy hardly seems an attractive place to park money.
Nonetheless, the timing of the S&P news did come as a surprise, knocking the yen sharply lower across the board.
Over time, the move could well help to weaken the yen to around Y90 to the dollar, especially if the financial markets start to speculate on the need for even more easing of monetary policy by the Bank of Japan.
See how the dollar has fallen against the yen over the last few months:
http://www.dowjoneswebservices.com/chart/view/5354
For the moment, though, the impact on the yen should be limited as the Japanese currency simply isn't that vulnerable to international investment flows.
With only 5% of Japanese government bonds held by foreigners, there is little scope for a wholesale pullout from the country as there might be in the case of other debtors.
So, despite the jolt, the yen is still trading within its recent range against the dollar, with any further decline in the Japanese currency more likely to be triggered by positive news for the dollar.
Certainly, new trade data suggest that recent pressure on Tokyo to push the yen lower is subsiding. Exports rose by a much stronger-than-expected 13.1% in December from a year before, reflecting increased sales to China as well as the U.S. and suggesting that Japanese exporters remain highly competitive despite having to deal with what many consider a highly overvalued currency.

Bloomberg TNI FRX POV
Reuters USD/DJ
Thomson P/1066 or P/1074

Good morning all!!

Nice to see the 61.8fib was hit while I slept, if I catch any shorts today I'll be letting them run for a bit longer than my usual 10-20pips.

txs

hourly close under could open up 3670 again....

http://www.youtube.com/watch?v=71AU-O_YdLc

if the hourly close below 3706 then the next will be 3684, 3668 and 3653.

Could be be I see a nice H&S pattern instead..

No trades for me till news though, time to get some breakfast. Expecting ranging for the next 30 mins and after yesterday, I'm not keeping a tight stop around news; damn spreads.

while you're waiting for that, i'm short to 3700

haha, was taking a nap... si le chat n'est pas la, les souris dansent.

agreed. Im long on 1.3714

SL 1.3694
TP 1.3734
0.20%

us in....and the market is silent...???

I wish you got your tp.. Good luck
I already grab some pips in euro.. will take it again on confirmation..

Currently managing EJ

sounds good plan...

there is an inverse head and shoulders forming on 5MIN.. and 3700 level holding, so a nice spike up should be in order

LOL - Indeed. She's trying to get back below, but thus far no dice. And we've got an obviously bullish pattern pattern forming. I'm going to sit on my hands for the moment.

Many are waiting for the US data coming out at 8:30est

More BS numbers due out for the US at 8:30... they are so optimistic... sure doesn't look or feel that way.

salam hi all

news took it down and up what next

we need a break on eur and dixy

are topped and bottomed

a close above 3740 will change the whole picture

for now walking the dogs till other wise

enjoy the ride sl is a must have fun or camel balls