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USD/JPY Discussion

  • #25,221
  • Aug 1, 2011 8:09pm Aug 1, 2011 8:09pm
Is it a strong reversal or another disappointing small bull ?
Only time will tell...looks like still ranging...I'm staying out.
  • #25,222
  • Aug 1, 2011 8:11pm Aug 1, 2011 8:11pm
Quoting bbakker
To drive it to supply for another sell off. I see nothing on the charts that indicate a turn nor as fosking stated from a fundamental point of view. If people want to buy it because it is 'cheap', then I won't stand in their way, as after all it is their money. Same with the Swissy. I will wait for the market to show its hand before I start longing either pair.
i agree.. we made a nice high yesterday then long way down.. we made a nice high few hours back, uj is back down. i m out atm but have a short usdchf..but with more and more talk about intervention etc, i am not convinced downtrend will continue. senate votes in 20 hours or so and i will be looking for a long at 76.6
with a bit of sheer blindness to fundementals and stubborn $ buying, i will buy at 77,7 looking for fast 30 pips to yesterdays high
  • #25,223
  • Aug 1, 2011 8:23pm Aug 1, 2011 8:23pm
Looking at the fundamentals let me see if my analysis works for today:

USD will range sideways, JPY will weaken and Euro& GBP will move up.

Reason:
- Debt deal effect on market is not seen yet, I think USD will wait for NFP data to trend.
- Talks of intervention will keep JPY above water
- To sell JPY, BOJ will buy GBP or Euro and not USD.

I will still stick to my technical analysis
  • #25,224
  • Aug 1, 2011 8:24pm Aug 1, 2011 8:24pm
Very strong appreciation and depreciation within the space of a minute ...well, well, what do we have here !
  • #25,225
  • Aug 1, 2011 8:51pm Aug 1, 2011 8:51pm
Quoting CoffeeGamble
Very strong appreciation and depreciation within the space of a minute ...well, well, what do we have here !
my bet is on some sl taking and off we go with a hammer so biig
  • #25,226
  • Aug 1, 2011 9:20pm Aug 1, 2011 9:20pm
Quoting ledobedo
my bet is on some sl taking and off we go with a hammer so biig


I don't trust any move - when you have profit...take it.
  • #25,227
  • Aug 1, 2011 10:15pm Aug 1, 2011 10:15pm
love the intervention... finally a committed move from BOJ...
  • #25,228
  • Aug 1, 2011 10:21pm Aug 1, 2011 10:21pm
I'm still riding the trend with long bias

On hourly charts UJ double bottom held
  • #25,229
  • Aug 1, 2011 10:26pm Aug 1, 2011 10:26pm
Quoting ultra_knight
I'm still riding the trend with long bias

On hourly charts UJ double bottom held

not much downside (we saw BOJ protecting 76.50 yesterday)..
upside ... 83-85? then 93-95? hope i'm not too optimistic..
  • #25,230
  • Aug 1, 2011 10:34pm Aug 1, 2011 10:34pm
Quoting MarcPeanut
not much downside (we saw BOJ protecting 76.50 yesterday)..
upside ... 83-85? then 93-95? hope i'm not too optimistic..
Target of double bottom pattern is 95
  • #25,231
  • Aug 1, 2011 10:52pm Aug 1, 2011 10:52pm
Quoting ledobedo
my bet is on some sl taking and off we go with a hammer so biig
I think so too. I'm surprised they started so early, but there'd be no point in an intervention that everyone foresees.
  • #25,232
  • Aug 1, 2011 11:33pm Aug 1, 2011 11:33pm
Quoting MarcPeanut
not much downside (we saw BOJ protecting 76.50 yesterday)..
upside ... 83-85? then 93-95? hope i'm not too optimistic..
you sure that was BOJ???
  • #25,233
  • Aug 1, 2011 11:34pm Aug 1, 2011 11:34pm
Quoting CoffeeGamble
I think so too. I'm surprised they started so early, but there'd be no point in an intervention that everyone foresees.

sorry im a newbie.. an intervention that is alraedy expected wont work?
how is it early? was around march lows...
  • #25,234
  • Aug 2, 2011 12:42am Aug 2, 2011 12:42am
Quoting MarcPeanut
sorry im a newbie.. an intervention that is alraedy expected wont work?
how is it early? was around march lows...
The greater the surprise factor, the more a central bank can shock the market. If most of the market correctly forecasts some external influence, it's prices won't react as much.

Cukierman and Meltzer published research on central bank transparency vs. ambiguity in 1986.

"A Theory of Ambiguity, Credibility and Inflation Under Discretion and Asymmetric Information"
  • #25,235
  • Aug 2, 2011 1:35am Aug 2, 2011 1:35am
With HSBC firing 30,000 bankers, the economy
is generally bad...there's no reason for USD to
bull much....and BOJ / G7 will not want to lose
$ also...I guess the best bet is to watch first...

At this juncture, it can either go up or down...
  • #25,236
  • Aug 2, 2011 2:02am Aug 2, 2011 2:02am
What I would like to know is why people care whether a central bank makes a profit or loss. A central bank's goal is not to profit or cut losses like any commercial bank would. The goal is to stabilize inflation, the financial system and regulate. If they spend much more than they bring in, so be it. They have so much reserves, of which a tiny fraction is legally freed up for employee salary. If reserves disappear, more money is printed, problem solved. What is it with the media caring about central bank profits ? Central bankers are not to be judged in their skills by the bank's "profit", but by their skills to provide the best circumstances for financial soundness. This article sums it up:


http://www.edlotterman.com/RWE/Articles/20100114.htm
  • #25,237
  • Aug 2, 2011 2:12am Aug 2, 2011 2:12am
Quoting CoffeeGamble
The greater the surprise factor, the more a central bank can shock the market. If most of the market correctly forecasts some external influence, it's prices won't react as much.

Cukierman and Meltzer published research on central bank transparency vs. ambiguity in 1986.

"A Theory of Ambiguity, Credibility and Inflation Under Discretion and Asymmetric Information"

thanks! seems like risk aversion is still the theme of the day..
  • #25,238
  • Aug 2, 2011 2:30am Aug 2, 2011 2:30am
Quoting MarcPeanut
thanks! seems like risk aversion is still the theme of the day..
You're welcome, and if this risk aversion continues, I might ponder swissie versus yen. Then I'd be favouring one safe haven currency over another, hopefully reducing exposure to overall risk sentiment of the day.
  • #25,239
  • Aug 2, 2011 2:45am Aug 2, 2011 2:45am
hello all
an interesting article. http://www.reuters.com/article/2011/...74U02L20110802
  • #25,240
  • Aug 2, 2011 3:53am Aug 2, 2011 3:53am
Here is a copy and paste from 2009 which was posted by bpatto. I hope he doesn't mind me repeating it here, but it gives some insight into how the BoJ operates. He traded Asian markets extensively since the 1980s.

**********************************
Speaking from experience, the BOJ won't just flood the market with Yen. There will be a few precursor steps they will take, they want to get value for money.

Firstly they will leak news that they are going to intervene, this has already happened, and will continue to happen. It will in effect remove alot of the institutions that are Yen bullish, and allow them to slowly reverse their strategies.

Secondly, and this is the most important, the BOJ will spend a couple of days "checking rates", you will see items on the newswires like "BOJ checking rates" or "BOJ looking for orders". This will instantly turn the market around for a week at a time and they haven't spent a Yen as yet. Eventually they will have to open their wallets, but by the time the anouncement happens their orders are well and truly stacked at different levels in the market. And it will usually occur on a day when a large institutional option is due, they way they get a little bump in the right direction and yes it will probably be outside of the asian session when volumes are higher.

That said, nothing is going to stop the repatriation of Yen loans, it is is just too large, and no-one really knows how big it is going to be. So as with the Asian Financial Crisis in the 90's, eventually the BOJ will be ignored.
******************************

Hope it's helpful to someone.
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