Best to sit back and see how market wants to react

  • The statement from Mr Bernanke that all options are still on the table and policy decisions are data dependant would seem at first glance to be risk-positive and USD-negative.
  • No sign of any big moves in AUD/USD or the Yen crosses would seem to belie this notion.
  • No sign of any sharp moves higher in EUR/USD so last week’s sharp short-covering rally might have been a one-off event?
  • EUR/JPY still trying to form its right shoulder.

In other words, the market gave no big hints in overnight trade and I think it’s probably best to sit back for a session or two and see if the market does start to move one-way.

I remain overall USD bearish with a slightly risk-off bias so I still prefer the sell-rally play in USD/JPY.

  1. I think that’s absolutely right Sean: given the mkt’s muted response to BB’s testimony, it seems that not many are are prepared to commit to a stance one way or the other. I was watching it all live but he really gave me nothing decent to work with.

    I particularly liked BB’s note on “how the markets are beginning to understand us”…what the frig? is the guy living on Mars? Haha…

  2. Morning Sean, I’m still short EUR/JPY also. Last night, the s/l just above 131.4 looked a bit shakey but thankfully it did a u-turn just shy of it. Are you targeting any specific levels or playing it by ear for now?
    I’ll look to add if 131.10/20 is tested and holds again. I was a bit hesitant last night ahead of the Bernanke lottery, but in the end there weren’t any real surprises.

  3. Thks Chngster, I didn’t watch live so it’s good to hear from those that did. Stay agile until early next week I think then maybe the fog has cleared?

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