EUR/AUD: Broad consolidation 1.2600/1.2750 but looking bullish
The fact that the AUD fell back on Friday afternoon to finish the week on its lows. despite recoveries in precious metal and equity markets, shows just how much sentiment is turning. The EUR benefitted from ECB comments regarding the effectiveness of any further interest rate cuts. I remain long and bullish on this pair with a target at 1.3200.
(Charts in members).
AUD/JPY: Still capped by Fibo resistance at 102.85
The 61.8% retracement of the 105.40/98.70 fall comes in at 102.85, which was the high on Friday night. This level should attract some profit-taking ahead of it and stops tight above there.
Heavy flows going through in early Europe
- Sovereign names selling USD/JPY in reasonable size near 99.25 but no sign of a pullback yet.
- Sovereigns buying EUR/USD just below the market a little earlier.
- Large GBP/JPY buying at Fix.
- Talk of large M&A flows driving GBP/USD sentiment.
(FX trading is definitely not a fair game when you consider the information that the big banks and hedge funds get just before everyone else).
AUD/JPY: Trying risky shorts ahead of technical resistance
The 61.8% retracement of the big fall from 105.40 to 98.70 comes in at 102.85. I've taken a risky short trade here at 102.70. Fibos are not nearly as reliable when trading against the dominant trend but I'll give it a go as I think this move now is all about stop-loss hunting.
There go the GBP stops
As I mentioned a little earlier they were lined up with most of the big banks waiting to be hit. I'm going to try buying the dip in EUR/GBP towards .8500, let's see what happens.
AUD/USD: Testing intraday offers again
Decent-sized selling interest was reported earlier today at 1.0335/40, which is where we are now trading. Looks like the short-term speculative market is short of Aussie and there are likely to be stops above 102.10 as well in AUD/JPY.
GBP: Expect stops to be targeted in early European trade
- EUR/GBP: Stops reported below .8530.
- Cable: Stops reported above 1.5325.
USD/JPY: Real money sellers reported above 98.60
Comments from Japanese FinMin Aso have accelerated the buying in the Yen crosses but USD/JPY is expected to run into some heavy selling from real-money accounts above 98.60.
If it looks and smells like a Toshin flow...
A good source at a local hedge fund is hearing that Toshin demand is driving the NZD and AUD higher in the last few minutes of trade. It certainly does look like that might be the case with NZD/JPY up almost 50 pips in the last hour of trade.
South Korean FinMin says weak Yen is bigger threat than North Korea
So much for no mention being made at the G20 of Japanese FX policy!
We might see USD/JPY dip a little on these comments.
Asian market open
You can click through here and read my opening comments on FX Street.
Looks like its going to be a very quiet session here in Asia.
EUR/USD: Solid bids reported near 1.3025
I don't have any other strong opinions on this pair so perhaps its best to go with the order boards and buy intraday dips towards reported bids at 1.3025.
EUR/JPY: Looking to play 127.50/129.00 with a bullish bias
The short term charts (see members) suggest that EUR/JPY is consolidating in a wedge pattern after retracing to a 50% Fibonacci level. This is generally a bullish set-up so I'd suggest some broad range trading between these parameters with a bullish bias.
Gold gets lift from Swiss referendum news
I really don't know enough about Swiss politics to know whether this is a serious undertaking or one driven by cranks (106,000 signatures), but the Swiss are a serious folk and I'm presuming that they don't undertake referenda on frivolous whims.
The proposal is to repatriate all SNB Gold from overseas (similar to what the Bundesbank has been contemplating) and that the SNB must hold at least 20% of total assets in Gold. I'm sure Max Keiser will be having a field day.
There are undoubtedly still some big positions out there presently being unwound so I'm still tipping some medium-term consolidation between $1200/$1500 before the bull trend resumes.
AUD/USD: Look to play 1.0270/1.0330 range
I'm expecting a fairly quiet session unless the hedge funds have another go at moving the market like they did yesterday. I'm not sure that they will find as many willing liquidity providers today! Orders are reportedly firm at 1.0260/65 and 1.0335/40, just like they were yesterday, so I'd suggest playing this range until something changes.
EUR/USD: Heavy turnover but going nowhere
- EUR/USD is still stuck at 1.3050 despite banks reporting some very heavy turnover.
- EUR/GBP is starting to retrace some of yesterday's losses.
- AUD/JPY is testing short-term resistance near 101.50 and the important topside levels to watch are 102.10 and 102.85.
- I'm not alone in my bearish AUD stance with a large number of professional traders and analysts coming out with bearish strategies over the last few days; as we know, that in itself means nothing but if its still at these levels in a few weeks time then we had better watch out on the topside!
- Large sell orders reported in USD/CAD above 1.0325.
Have a good evening and catch you tomorrow ++
AUD/USD: Locals caught bit short late in the day
Most of the local banks were bearish and short AUD today and they are being squeezed in late Asian trade. I'm guessing that most have been squeezed out by now and sell orders are reported close by starting at 1.0335 which are likely to cap any early European rallies.
USD/JPY: Fairly heavy stops reported below 97.50
- Cable: Clearer seen buying decent amount in recent trade.
- AUD/USD: solid bids 1.0260/65, stops below 1.0250, more bids 1.0230/35.