Open/Wrap

Asian market open

You can click through here and read my full Asian market open commentary on FX Street.

  1. Good morning Sean.Wonderful opening analysis as usual.
    Techinically euro is looking bullish across most majors.But logically( fundamentally..these two terms are not always interchangeable though),
    this entire move seems a little bit overdone.
    The market took advantage of thin markets to knock some weak shorts out but it hasnt really broken out dramatically.(1.3000 and 1.3170)
    three major factors:-
    1. Spanish politics.IF 20% of ur GDP professes to secede from the sovereign its major news but it has been very suspiciously put to the back burner by the market.
    2.I do think that once news of greece recieiving its package has been confirmed the euro will drop like a stone.especially the weak longs who have been buying at these highs pulling out and exacerbate things.
    3. The fiscal cliff issue has slowly but surely been drifting along with a sinister undertone. Alot of noise but i believe that once the spotlight shifts from europe the markets will work itself into a frenzy over this. and is with politics, they need a bit of market pressure to get the ball rolling, till then its just cocktails and conferences.
    As for the yen pairs id prefer to stay out of any long term view (yes thats a very contrarian view) until Abe puts his money where his word is.Rhetoric is fine but i still do think that by pushing market expectations so high hes bound to dissapoint.
    Im bearish on the euro for these above mentioned reasons (and many more) but my stop loss is not a price level as such.its more a manual exit to how markets will react in this coming week.
    I hope im not horribly wrong :D..but thats just my view.

  2. Cheers Rahul, and I do agree that the EUR short-exit should not be determined purely by price but more by a shift in mkt sentiment, which certainly hasn’t happened yet. I’m thinking that short cable might be a better plan for next few days??

  3. Im actually a bit out of sync with the cable sean.The cable and the eur/usd has a weekly correlation of 73 at this point and as long as i dont see a shift in sentiment in the euro id be a bit wary about shorting the cable.id like to think there could be a few easier trades out there.

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