Intraday Market Thoughts

Archived IMT (2010.09.15)

by Ashraf Laidi
Sep 15, 2010 23:14

HOW HIGH USDJPY ? USDJPY faces a 4-month trendline resistance at 85.90s, which coincides with the 55-day MA and the 23.6% retracement of the decline from the same May high. Technically, 1-day gains in USDJPY of more than 2.5% have usually seen follow-up buying, which raises chances of seeing an 87.50s print this month (capped under 88), with the help of neutral to positive US data. It is important for the pair to close above 86.00 to draw more sustainable bids. CONSIDERING YEN SEASONALS and the inability for global BOND YIELDS to undo-their multi-month downward trendlines, I see a gradual pullback towards 81 and 80 later in the year. As for the seasonals, the Japanese currency has usually appreciated in August/September ahead of the end of the first half of the fiscal year (Sep 30), which usually involves repatriation by Japanese corporates and life insurers into the end of the month. RBNZ left held rates unchanged at 3% as expected but the statement was more dovish than expected, which weighs on NZD across the board.EURNZD rallies +120 pips as per Pre-RBNZ tweet, daily stochastics 1.8020s.


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