As pundits begin using the words “gold” and “bear market” territory in the same sentence, this may not be an excuse to go the other way. Today's gold damage has been spectacular but of no surprise, hitting last night's 3 Premium shorts. The day's $70 decline was helped by news of that Cyprus was seeking to sell € 400 mln in gold and chatter of Merrill Lynch 4 million ounces at the COMEX open has also triggered the cascading of stops. Interestingly, FX markets ended little changed as all the activity was in metals. We will send fresh insights next week on the latest balance of power between gold and silver, and which of the 2 is set to lose more ground. Next week, shall also see the return of more JPY volatility ahead of the G20 meetings in Washington. Note the difference in rhetoric between the G7 and the G20, which includes China and Korea, pertaining to JPY flows. We added 3 new trades on gold and posted 4 new charts to our Premium subscribers, which can be viewed in the latest premium Insights.

Improved US jobless claims boosted sentiment on Thursday as USD/JPY flirted with 100. Commodity currencies gained as the S&P 500 hit a fresh record high. Looking ahead, comments from Kuroda and the Japanese tertiary industry index are the highlights. Earnings from Wells Fargo and JP Morgan could impact early trade.  Both of the 2 longs issued on AUDUSD before the jobs report remain in progress. We added 2 new trades in gold as well as USDCAD. For full view, please see latest Premium Insights.

Those who believe March data was skewed by seasonals got some ammunition as initial jobless claims fell to 346K compared to 360K. The Labor Department also noted that seasonal swings have affected the numbers.

The spike in claims caused some mild USD buying but positioning and market psychology are the larger driver in USD/JPY trading at the moment. The pair inched above Wednesdays high of 99.88 to reach 99.95 and could break through at any moment.There are rumors of large stops and sell orders around 100 but it's tough to get a clear picture.

It was hard not to be impressed with the resilience of AUD/USD after yesterday's weak employment report. The pair fell 50 pips and then turned around and rallied to 1.0580 which is the highest since January. Reserve managers continue to reward Aussie's high yield status and AAA rating as the RBA admits it will not intervene or jawbone in the currency.

The Asia-Pacific week winds down in typically quiet style on the data front but BOJ Governor Kuroda will be delivering a speech at 0310 GMT. The market has been sensitive to subtle hints on policy and that will continue as USD/JPY flirts with 100.

The lone indicator on the calendar is the February Japanese tertiary industry index at 2350 GMT. Expectations are for a 0.7% rise following a 1.1% decline in January.

As the USDJPY touches 99.95, eyes begin to shift to next week's G7/20 meetings in Washington and speculation over the verbal consensus/opposition with regards to Japan's monetary policy.  Aussie shrugged the poor jobs report (tumbling payrolls and rising unemployment rate) to break above 1.0550, while printing +105 against the yen. Reserve managers continue to reward Aussie's high yield status and AAA rating as the RBA admits it will not intervene or jawbone in the currency. EURUSD shies away from the DMA confluence ahead of Friday's US retail sales. Earnings from Wells Fargo and JP Morgan could impact early trade.  Both of the 2 longs issued on AUDUSD before the jobs report remain in progress. We added 2 new trades in gold as well as USDCAD. For full view, please see latest Premium Insights.

The gold/S&P500 ratio has fallen below 1.0 for the first time in 3 years, losing 40% from its 23-year peak of August 2011--the longest decline since mid-1990s. See what the chart is telling us 

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AUD/JPY is in a precarious spot ahead of today's Australian employment report. On Wednesday, the Australian dollar climbed again while the yen lagged. Other reports include Japanese machine orders and second-tier inflation data. This evening's new Premium trades include USDJPY (with tactical rationale of manoeuvring the next sessions), GBPUSD, AUDUSD, EURJPY and USDCAD. Both EURUSD trades remain in progress. All is found in the latest Premium Insights.

AUD/JPY heads into today's employment report riding a 5-day, 800+ pip wave of excitement about the Bank of Japan QE program. On Wednesday, the pair blasted through the 2008 highs and is now within striking distance of the all-time high set in 2007.

The risks are double because last month's employment report was the strongest in 12 years as the economy added a whopping 71.5K jobs. The massive gain left economists scratching their heads with estimates ranging from +15K to -55K. The consensus has settled around -7.5K but after last month's gain there is the risk of a big miss. The numbers will be released at 0130 GMT (2:30 London). Earlier releases include the Japanese CPGI and Feb Japanese machine tool orders, which are expected up 6.9%.

On Wednesday, the Australian dollar rally was fuelled by the risk trade as the S&P 500 gained 1.2% and broke the all-time high set in 2007.

The market was caught off guard by an early release of the FOMC minutes after a leak yesterday. The minutes showed an FOMC that sounded surprisingly eager to taper asset purchases. It's important to keep in mind that the minutes were before the latest round of soft economic numbers.

In any case, the gold market was the only thing seriously jarred by the report, as the metal dropped $25 to $1558.

S&P may have raised its outlook on Cyprus to stable from negative and the FOMC issued their minutes ahead of time, but USD strength and godl weakness are moving in tandem. We added a new edition of the Premium Insights, focusing on yen weakness ahead of next week's G-20 meetings. We issued trades on USDJPY, GBPUSD, AUDUSD, EURJPY and USDCAD. Both EURUSD tradesd remain in progress. Gold, silver, oil and EURGBP will be updated in the evening alongside new charts to back up the latest Premium Insights.

USD/JPY proved irrepressible on Tuesday as the euro edged above 1.31. The best performers on the day were AUD and NZD while the US dollar lagged. The upcoming session offers some insight into the strength of the Chinese economy with trade figures. All 4 longs in EURJPY of the past 2 days hit final targets, while 2 silver and 1 gold were stopped out. EURUSD and USDCAD longs remain in progress as does oil. For full detail, please see the latest Premium Insights.

Overall sentiment was upbeat on Tuesday as the S&P 500 touched the highest since 2007. That positive mood meant broad US dollar weakness and gains for EUR, AUD and gold.

The yen is still the most captivating trade and the bulls demonstrated their willingness to buy once again, despite a flat close. A swift fall to 98.60 was rapidly gobbled up and the patient longs waiting for a deeper pullback were turned away once again as the pair rose to 99.30.

Turning to the Asia-Pacific region, yesterday we found out that Chinese inflation was slower than expected and today the focus shifts to pipeline growth. Trade balance figures will be released at 0200 GMT but a surplus/deficit is less important than the magnitude of the rises in imports and exports.

Imports are forecast to rise 6.0% y/y and exports 11.7% y/y. Imports will be followed especially closely after a 15.2% y/y drop in February that was probably skewed by the early Chinese New Year. Chinese imports tend to be a solid long-term forecaster of growth because they are at an early stage in the global supply chain.

AUD/USD broke a March-April double top on Tuesday and touched the highest since January but the follow-through was negligible. An upbeat Chinese trade report would clear the way for a test of a higher range.

بإمكانك الانضمام لاشرف العايدي كبير المحللين الاستراتيجين فياف اكس سوليوشنز في محاضرة عبر الإنترنيت يحلل فيها النقاطا لمفصلية و الاتجاهات في سوق العملات.

ستُتِم محاضرتي على أللإنترنت يوم الخميس 20:00 (الرياض)، 21:00 (دبي). https://www4.gotomeeting.com/register/858192359.  

In today's Arabic interview with CNBC Arabia (English synopsis found below clip on youtube link), Ashraf discussses the upside flows near 1.3160s in EURUSD as the pair posts its 5th consecutive daily rise -- the longest series of advances since December. See here for full synopsis

Is it a case of stabilizing euro or falling USD? The balance of risks in FX is shifting from waning event risk in Eurozone to question markets about US growth (slowing services ISM, jobless claims and NFP).  EURUSD posts its 5^th consecutive daily rise—the longest series of advances since December. But the medium term picture for the single currency remains doubtful. We issued 3 new trades in EURUSD last night, 2 of which are currently in progress. One key source of volatility is Wednesday's release of the FOMC minutes. Each of the last 3 releases of the FOMC minutes has led to a rallying USD and tumbling gold. But this time it may be different. Although we may hear of the usual discussions about slowing down the pace of asset purchases, Friday's disappointing NFP will likely reduce markets' sensitivity to the hawkish deliberations and lead to selling any USD-bounce with greater confidence. For all the trades on EURUSD, EURJPY, gold, silver and US crude, please see the latest Premium Insights.

The one-way move in USD/JPY continued on Monday as the pair added another 200 pips and touched the highest since 2009. The Australian and New Zealand dollars were the best performers on expectations that Japanese money will chase yield. The main AUD risk in the upcoming session is the CPI report from China. The 3rd long in USDJPY hit all targets since Friday, while the 4th is in progress awaiting a higher final target. Last night's EURJPY hit all targets at 129.20, awaiting the 2nd to hit final target at 129.80 from 127.70. Rest of trades are seen in full in the latest Premium Insights.

The pace of the rally in USD/JPY has been breathtaking and now 100.00 is easily within striking distance. The one constant in the pair since November has been that pullbacks have been shallow, leaving patient dip buyers stuck on the sidelines. One thing that is different this time is the speed of the rally with USD/JPY up more than 700 pips since Thursday and crosses up more than 1000 pips. A test of 100 is inevitable at this point and short-term longs may be quick to take profits.

Outside of the yen, moves this week have been small. One exception is cable, which has retraced most of Friday's rally.

The first event to watch in Asia-Pacific trading is a speech from Bernanke at 2315 GMT. The Chairman's topic is bank stress testing so those looking for comments on the monetary policy outlook are likely to be disappointed.

Up next is Australian NAB business confidence at 0130 GMT. In general, the impact of this release is low and there is no consensus estimate.

At the same time China releases March official CPI numbers. With inflation expected to decelerate to 2.5% y/y from 3.2% in February, officials should be able to breathe a sigh of relief. The risk is that prices remain stubbornly high and force the government to take action, which could weaken the growth-sensitive commodity currencies.

The yen decline appears to be the path of least resistance , while the soaring Nikkei-225 has the green light to regain the 15,000 level. The index is up an impressive 27% since January in local currency terms. In GBP and USD terms, it is up 18% and 11% respectively. Here are the other impressive facts in absolute and relative basis. Full charts & Analysis

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The fact that USDJPY rallied 200 pips despite the disappointing NFP (88K was lowest since June 2012) speaks volumes of the historical decision from the BoJ. We are aware of the surprising decline in the US unemployment rate to 7.6%--lowest since December 2008--which the media hardly covered. 4 new trades in yen crosses have been added on Sunday night (noon Monday Asia time). The Eurozone maybe producing a fresh wave of woes --this time from Portugal - as the PM calls for new spending cuts to keep the country on track for its bailout program. Positioning EUR vs JPY during opposite flows is explained in our latest Premium Insights

USD/JPY surged anew to start the new week, nearly reaching 99. Last week the yen was the weakest performer while the Swiss franc and pound led the way. Positioning data showed speculators paring back yen shorts before the BOJ decision. On Friday,  2 USDJPY trades. 1 GBPJPY and USDCAD hit all targets, while 2 new USDCAD trades were added and are in progress. All these can be seen in the Latest Premium Insights.

USD/JPY climbed more than a full point from Friday's close, touching as high as 98.78 while EUR/JPY hit 128.32. A Nikkei report said the Bank of Japan plans to 1.2 trillion yen of government bonds this week. The rapid buying underscores the urgency from the BOJ and pushes USD/JPY toward the psychological 100 zone.

Late on Friday, Portugal's constitutional court ruled certain budget cuts illegal. On the weekend, PM Coelho reaffirmed his commitment to the EU/IMF bailout and said it is discussing replacement measures.

The euro fell 30 pips to 1.2970 at the open but quickly rebounded to 1.3000.

The week begins with Japanese current account data at 2350 GMT with expectations at a surplus of about 500 billion yen.

Commitments of Traders

Speculative net futures trader positions as of the close on Tuesday. Net short denoted by - long by +.

EUR -66K vs -49K prior JPY -78K vs -89K prior GBP -65K vs -66K prior AUD +84K vs +85K prior CAD -65K vs -63K prior NZD +18K vs +17K prior CHF -10K vs -13K prior US Dollar Index longs at 54K vs 54K prior

Speculators trimmed yen shorts at the worst possible time but speculators were still well-positioned headed into the BOJ decision. The increase in euro shorts shows that a large portion of the market is underwater on euro shorts and that could add fuel to the recent rally. Positioning changes in other currencies were slight.