Aside From the Euro

The non-stop headline risk in the euro has made for a messy playing field so we look at two non-euro trades and where they might be headed. The Australian dollar was the top performer Thursday while its kiwi cousin lagged. Japan is in focus later.  There are 3 Premium trades in progress, all of them long trades. EURAUD is in a loss, whole the other two trades remain in the green.

We've seen and heard almost everything from Greece in the past 6 years so we won't draw any conclusions prematurely. A dozen important headlines landed Thursday but, looking ahead the most important one is how the EU/ECB/IMF respond to a fresh Greek proposal.

Even if we did know the outcome, the euro may prove to be a difficult trade. Aside from the euro, two things stand out in the market at the moment.

The first is the latest incredible run from cable. It has now risen in 8 of the past 9 sessions in a non-stop 670 pip rally. In the short-term, it's surely overdone but 1.6000 will be increasingly magnetic and there is forever the possibility of a squeeze.

The second is oil. Market chatter surrounding oil has gone dim and rather than focusing on a hyper-analysed trade like Greece, we can focus on oil. The market is undoubtedly oversupplied. Respected Saudi oil minister Al-Naimi said Thursday that his country has an addition 1.5 to 2 million barrels per day of idled production.

Technically the roughly $57-$62 range has persisted for nearly two months. It won't last. Various intraday breakouts have failed so a breakout might not be clean but when it happens, it's likely to last at least $5 and potentially much more.

In the short term, USD/JPY briefly touched a three-week low on Thursday but a better Philly Fed led to a US dollar bounce. The zone around 122.50 will remain pivotal.

The BOJ monetary policy statement is due at some point in the session along with a speech from Nakaso but the bigger event is the May dept store sales at 0430 GMT. For the first time in years, the yen is showing signs of increasing sensitivity to economic data so we will be watching upcoming releases closely.