Intraday Market Thoughts

Euro Steps out of Yen's Shadow

by Adam Button
Nov 25, 2012 23:51

The yen was beaten up for the second week in a row as risk trades surged. EUR/JPY gained 350 pips to lead the way -- posting its strongest week since February. Meanwhile, EUR/USD required a convincing catalyst to lift it back above its important 200-DMA of 1.2820. And it did 6 trades from the Premium Insights hit all targets, 2 were stopped out, 4 remain in progress and 3 were unfilled.

The yen continues to be undermined by politics, with Japanese leaders making outlandish promises ahead of the Dec 16 election. The positive risk trade added to the momentum this week with stocks in Europe and the US gaining each day.

There are other factors as well, including signs that Japanese companies are beginning to move aggressively to buy up foreign rivals. On Friday, an executive at Mitsubishi UFJ said it is keen on a big US acquisition to become a top-10 US bank.

In Europe, political wrangling continues but there are signs that Greece is being shifted to the back-burner. When negotiations broke down on Thursday, the euro tumbled but it quickly regained the losses. On Friday, Germanys Schaeuble said he was confident on a solution for Greece and Rajoy said he wanted a deal in the week ahead.

EU budget discussions were delayed once again but the never-ending discussions are not likely to impact the FX market at any point.

Events early in the week include a speech from Shirakawa at 0100 GMT on Monday. He will be asked to comment on the election and the potential for further easing.

6 trades from the Premium Insights hit all targets, 2 were stopped out, 4 remain in progress and 3 were unfilled. 1 EURUSD short stopped out, while the long was unfilled. USDJPY in progress. Both GBPUSD hit all targets (two weeks in a row both cable longs hit their targets). AUDUSD long was unfilled (missed by 20 pips). 1 EURJPY long hit all targets, the other was unfilled. CADJPY long remains in progress, while both EURGBP finally hit all targets, which were in progress since Nov 14. One gold short stopped out, the other a new contingency long was filled and in progress. The long silver trade since Nov 7 finally hit its highest target of 33.90. The lone long in oil is in progress. For DIRECT ACCESS to these trades and the relevant charts, click here: NonSubscribers Can click here to join:



Latest IMTs