USD/JPY opened in NY 119.11/16 weighed down overnight by the news Russia was adding JPY to its foreign currency reserves. US investment and trading banks along with custody and European names were among the sellers but were met with good Japanese bids at 119.01. Good buying orders remain at 119.00 but stops are said to lie under 119.00 and are staggered down to 118.00. US data was positive with strong gains in the NY Empire State Manufacturing index and with hawkish comments from Fed's Poole. Bounces were capped at 119.30 with price action caught in a 119.01-30 range. The option defense remains at 120.00 and 120.50 but traders still see a risk for USD/JPY to test those levels if core US CPI and PPI, due this week, are high.
EUR/JPY was more bearish with the cross testing the top of the Ichimoku cloud at 149.01 for the first time since March. The cross was capped at 149.30 in NY with comments from EU Alumnia asking for more flexible Asian forex pushing EUR/JPY lows to levels just under 149.00. Traders are more bearish EUR/JPY then USD/JPY after the continued recent failures to break 150.50.
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