USD/JPY Back on the Brink of 100

Japan avoided a slap on the wrist at the G20 and that has boosted USD/JPY to the brink of 100. Last week, the US dollar was the top performer while its Australian counterpart lagged. Weekly futures positioning data showed a 40% drop in euro shorts. In addition to the existing shorts in AUDUSD and longs in USDCAD, we added new trades in GBPJPY, EURUSD, USDJPY, gold and silver as well as a monthly Gold/Silver ratio with multi-speed momentum. All trades and charts in the latest Premium Insights.

Yen crosses are higher to start the week, led by CAD/JPY. Moves higher in the yen crosses began late on Friday and have continued into the new week. The G20 is almost always a letdown and this version was no different. There were musings about monitoring Japan but officials spoke in platitudes and the Russian finance minister conceded that FX wasn't high on the agenda.

The euro is relatively stable in early trading despite the political drama in Italy. The failure to elect a new President cost Bersani the leadership of his centre-left coalition. After six rounds of voting, politicians re-elected 87-year-old Napolitano to the position.

The Asia-Pacific calendar has no important events scheduled to begin the week.

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

EUR -30K vs -50K prior JPY -93K vs -78K prior GBP -62K vs -70K prior AUD +53K vs +78K prior CAD -76K vs -71K prior NZD +31K vs +25K prior CHF -3K vs -10K prior US Dollar Index longs at 38K vs 50K prior

The euro wasn't particularly busy in the week of the sample but Tuesday was the day it closed above the 55-day moving average and that may have spooked speculators. The increase in JPY shorts suggests speculators were loading up on the drop below 96.00 last week.