Thought I would start my musings on the FX world in journal.
Typically, I trade USDJPY.
At present fundamentally this is the strongest and weakest pair. So it makes sense to concentrate on these.
By this I mean that the Fed are more likely to raise interest rates than any other currency at the moment- and the BOJ are more likely to lower rates on the Yen
Here is roughly how I trade. I look at everything first through fundamentals (directional interest rate bias of the central banks) and what they consider important (labour, wages, inflation etc..)
Next I review recent speeches from the central bankers to gauge their views
Then obviously consider all the main events (NFP, CPI, GDP, Retail Sales etc) and how these will impact the pair
Also there are geo-political events (eg: Brexit, unexpected news items) - that can effect this pair.
Then I need to be aware of the stockmarket and how it is performing.
With USDJPY you also have to be aware of safe haven flows.
When the stock market drops- then the UJ drops
Finally, there is the bond market to consider. I will talk about this later.
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At the moment the UJ is up a lot circa 150 pips from Monday
Its also up this tonight mainly on Kuroda's talk. He has said that "he sees further room to cut negative rates"
Yellen had an interview with Time magazine - where she was quite dovish
But this did not seem to affect the dollar that much, which is a bit of a surprise.
US dollar sentiment is positive at the moment - due to positive earnings coming through
Not sure what the Bank of America's figures will be like though- so need to take care on this
CPI is due today- which I think will either match or miss expectations
Everyone is waiting to see what Kuroda will do next week
Powell is due to speak at 3pm GMT- and he is I understand a neutral - so should it not affect things too much.
I would not be surprised to see the UJ sell off before CPI figures and then rally up afterwards
Typically, I trade USDJPY.
At present fundamentally this is the strongest and weakest pair. So it makes sense to concentrate on these.
By this I mean that the Fed are more likely to raise interest rates than any other currency at the moment- and the BOJ are more likely to lower rates on the Yen
Here is roughly how I trade. I look at everything first through fundamentals (directional interest rate bias of the central banks) and what they consider important (labour, wages, inflation etc..)
Next I review recent speeches from the central bankers to gauge their views
Then obviously consider all the main events (NFP, CPI, GDP, Retail Sales etc) and how these will impact the pair
Also there are geo-political events (eg: Brexit, unexpected news items) - that can effect this pair.
Then I need to be aware of the stockmarket and how it is performing.
With USDJPY you also have to be aware of safe haven flows.
When the stock market drops- then the UJ drops
Finally, there is the bond market to consider. I will talk about this later.
__________________________________________________________________________________________________________________________
At the moment the UJ is up a lot circa 150 pips from Monday
Its also up this tonight mainly on Kuroda's talk. He has said that "he sees further room to cut negative rates"
Yellen had an interview with Time magazine - where she was quite dovish
But this did not seem to affect the dollar that much, which is a bit of a surprise.
US dollar sentiment is positive at the moment - due to positive earnings coming through
Not sure what the Bank of America's figures will be like though- so need to take care on this
CPI is due today- which I think will either match or miss expectations
Everyone is waiting to see what Kuroda will do next week
Powell is due to speak at 3pm GMT- and he is I understand a neutral - so should it not affect things too much.
I would not be surprised to see the UJ sell off before CPI figures and then rally up afterwards