Boris and Kathy's FX Blog www.bktraderfx.com
9/28/2006
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Comments from the Japanese
Comments by Vice Finance Minister Hideto Fujii today that euro’s appreciation against the yen this year has been a “little rough”, sent USD/JPY and EUR/JPY plunging 30 points within a minute of the news. This is the second time that Japanese officials have used such language to describe EUR/JPY movements and it suggests that the 150 EUR/JPY level represents the “Maginot line” for the pair that world’s central banker do not wish to see crossed. Although USD/JPY managed to regain most of its losses within an hour of the statement yen remains significantly oversold especially against the loonie. Yesterday a jump to $63/bll boosted the Canadian Dollar, but rise may be nothing more than a dead cat bounce fueled by speculation that OPEC may curtail production rather than the fundamental facts that inventories remain near record highs.
Furthermore today traders will be watching Canadian Industrial Production which is expected to contract materially from 1.7% rise the month prior to register no gain. Meanwhile overnight Japan’s Retail Trade data surprised to the upside jumping to 2% fro 1.1% expected providing a positive tone for the unit for the rest of the day. Finally tomorrow’s CPI numbers are all forecast to print much “hotter” than the month prior. So all in all CAD/JPY presents an attractive risk reward trade here with stops no more than 20 points above recent swing highs of 106.00
Sign up for our email alerts if you want them instantly!
Comments from the Japanese
Comments by Vice Finance Minister Hideto Fujii today that euro’s appreciation against the yen this year has been a “little rough”, sent USD/JPY and EUR/JPY plunging 30 points within a minute of the news. This is the second time that Japanese officials have used such language to describe EUR/JPY movements and it suggests that the 150 EUR/JPY level represents the “Maginot line” for the pair that world’s central banker do not wish to see crossed. Although USD/JPY managed to regain most of its losses within an hour of the statement yen remains significantly oversold especially against the loonie. Yesterday a jump to $63/bll boosted the Canadian Dollar, but rise may be nothing more than a dead cat bounce fueled by speculation that OPEC may curtail production rather than the fundamental facts that inventories remain near record highs.
Furthermore today traders will be watching Canadian Industrial Production which is expected to contract materially from 1.7% rise the month prior to register no gain. Meanwhile overnight Japan’s Retail Trade data surprised to the upside jumping to 2% fro 1.1% expected providing a positive tone for the unit for the rest of the day. Finally tomorrow’s CPI numbers are all forecast to print much “hotter” than the month prior. So all in all CAD/JPY presents an attractive risk reward trade here with stops no more than 20 points above recent swing highs of 106.00
posted by BKTrader # 9/28/2006 06:38:00 AM 
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