Seeing Stars : Perseids Monday in FX

I tried to see if I could catch any remnants of the Perseids meteor shower peak last night from our vantage point in Singapore. Excited, I spotted a few glitters in the sky. But they turned out to be stars instead.

USDJPY

USDJPY has declined in 4 of the last 5 Augusts and today’s GDP miss ( +0.6% QoQ vs expected +0.9% and +2.6% annualised QoQ vs expected +3.6%) is likely to push it lower ahead of this year’s Obon holidays.

August

13th-15th: Obon (Festival of Souls): although this is not an official national holiday, many offices are closed (most of the country celebrates this festival in August)

http://www.japanspecialist.co.uk/travel-tips/national-holidays-in-japan/

“During this period, exporters tend to leave JPY-buying orders with banks, which we believe is one factor supporting the JPY. From the investor side, UST coupon payment and redemption related JPY buying likely adds to upwards pressure for the JPY.” Source : JPM

JPM cut Japan’s 2013 growth forecast this year to 2% from 2.2% while Europe was upgraded.

The 50 day moving average of the USDJPY has crossed under the 100 day last week. It is all addinig up, with the street turning short USDJPY .

If the speculative positions are any indicator, we note that the speculative longs are exiting as of 6 Aug, going by the CFTC futures data. I guess, 93.50 and Ichimoku, here we come !

USDJPY VS CFTC POSITIONING

AUD/USD

To last week’s best performer, with the exception of Silver, AUD forges ahead.

A special release Pre Election economic and fiscal outlook will come out of the Treasury tomorrow. That is likely to sober up the markets a bit and now that the currency forecasters have shut up, it does look like I can attempt to trade AUD from the short side this week.

Australia is, afterall, another Chinese province which makes last week’s good news factored into current spot although the entire market will probably be on the same side as me given that the CFTC positioning report (as of 8 Aug) is showing the largest shorts in 5 years.

aud cpain cesiaud cftc net position

Another factor for me would be the Eurozone GDP out on Wed. Economic numbers have been turning out good and this could be a turning point for EURAUD.

EUR/USD

I cannot bring myself to like EUR yet though. New developments daily reveal a certain half baked picture of the situation and the weekend headlines on the banks’ capital gaps may or may not blow up into a crisis story depending on the whims of the journalists (or they may decide to save it for a lull week).

GDP on Wed likely to keep the price supported and in range.

Boring.

The Rest Of The World

EURUSD 1.3325 0.41%
USDJPY 96.16 -2.40%
AUDUSD 0.9197 3.33%
NZDUSD 0.80385 3.51%
GBPUSD 1.55065 1.04%
USDCHF 0.923 -0.86%
USDSGD 1.25855 -0.78%
USDCNY 6.123 -0.03%
USDKRW 1112.85 -0.06%
USDMYR 3.2322 0.06%
USDTWD 29.9415 0.07%
USDTHB 31.21 -0.38%
USDINR 61.16 0.47%
USDIDR 10292.5 0.38%
EURJPY 128.13 -1.98%
EURAUD 1.448825 -2.81%
XAU 1327.75 1.36%
XAG 20.93 5.64%

Check out the performances last week. Wild ride for some and sleepy town for the others.

GBP was silent killer, making her move surreptitiously along with the AUD as Carney comes across CONFUSING ! Not touching that.

Singapore’s GDP beat today came with a huge disclaimer for her growth outlook. We did see USDSGD touch the 1.2560 after her birthday weekend as we had predicted.

From JPM.

“The trend thus still favors owning USD against those currencies that became too addicted to the capital inflows caused by low US bond yields (IDR, ZAR and MYR). However, a mercifully crisis-free August and attendant position fatigue could further challenge USD longs vs. EM over the next few weeks.”

Verdict : Still seeing stars.

 

Related Post :

CANDLES TO CELEBRATE NATIONAL DAY – USDSGD (tradehaven.me)