JPY 01 (May 08 - Oct 11)

[winston]

JPY now at 84.

Didn't the parrots on CNBC say that it will be at 75 very soon ?

[winston]

DJ MARKET TALK:JPY May Fall On Tighter China Monetary Policy-Citi

0119 GMT [Dow Jones] China's expected tighter monetary policy ahead indicates that the JPY is likely to weaken, says Citibank's Japan FX chief strategist Osamu Takashima.

"With higher interest rates, the cost for China to maintain its vast foreign currency reserves will increase," he says. To offset such a cost, China is likely to prefer investing in higher-yielding assets, such as assets denominated in AUD, and NZD, he says.

"It's highly unlikely that low-yielding yen-denominated assets will be a major investment vehicle for China," he says.

Adds, China may also refrain from actively buying U.S. Treasurys as higher-return agency bonds, and MBS are likely to be preferred, prompting their yields to rise, which would be positive for the USD.

He tips the USD/JPY to rise to 85.00 if the key 84.83 level is breached. The pair is at 83.91.


Source: Dow Jones Newswire

[ichew]

He tips the USD/JPY to rise to 85.00 if the key 84.83 level is breached. The pair is at 83.91.

hehe but 84.83 is only 0.17 away to 0.85

[winston]

US Dollar Seen To Rally Against The Japanese Yen By Ron Acoba

So after being routed by Japanese yen for the last three years, it seems like the US dollar’s recent rally will extend at least in the near term. Earlier today, the Bank of Japan, which is headed by Governor Masaaki Shirakawa, decided to keep its interest rate unchanged for the foreseeable future to encourage spending.

Japan’s core consumer price index, which measures the change in the price of goods and services consumed minus the price of fresh food, remains stuck at -0.6%. A decrease in prices suggests that overall consumption in the country is very weak.

So to support growth, keeping interest rates at a very low level will jump start lending and spending. The BOJ aims to keep the rates at this level until the CPI reaches 0.1% hopefully by next year.

Doing so, of course, would be bearish for the yen since it would make investments in Japan less attractive. Such would in effect encourage investors to source their funds in Japan because of the country’s low borrowing costs and place it somewhere else.

Technically, it appears that the USDJPY pair about to breakout from a cup and handle formation. In the chart, the cup’s handle would be the ascending triangle patter that I marked. A break above the formation’s neckline would swing the USDJPY towards a temporary target of 86.00.

A move above this could send the pair higher to around 88.00. But over the longer term, the bias remains to be bearish for the USD and bullish for the Japanese yen given the pair’s overall downtrend.

http://www.dailymarkets.com/stock/2010/ ... anese-yen/

[winston]

WE'RE GOING GLOBAL FOR A CURRENCY TRADE

Now that commodities and stocks have soared since September, it's near impossible to find the bad-to-less-bad "carve out" bottoms we used to find super trades like Diamond Offshore, Google, and Fuel Tech.

But we're persistent folks at DailyWealth… and we'll go anywhere on the globe for ideas. Today, we go to Japan…

As we've featured many times, the surest bet in all of finance is banking on the long-term decline of paper money (like dollars, euros, and yen) versus real money (gold).

The story around the world is simple: For generations, politicians have promised the moon to voters… and rung up debts that cannot be repaid. This is harmful to the value of fiat paper money.

One such currency is the Japanese yen. Experts note the government's financial statement is a horror show. We'll note that the "anti-yen" investment fund, the UltraShort Yen has suffered a big decline in the past year… but has spent the past two months going from bad to less bad. There aren't many "carve out" bottoms out there to trade these days, but this is one of them…

www.dailywealth.com

[winston]

JPY at 82.86.

Weren't they talking about a weak JPY not too long ago ?

[winston]

JPY @ 82.45 now.

What is the price that will bring the market down ?

81 ? 80 ? 79 ? 78 ?

[winston]

JPY appreciated more than 30% against the USD, since 2007 ...

[winston]

Not vested

Japanese yen

– Earlier in the week the Governor of the Bank of Japan reiterated his stance that the economy would soon emerge from a period of recession characterized by falling prices.

Mr. Shirakawa appeared vindicated in a slew of data out at the end of the week including an unexpected decline in the rate of unemployment to 4.9% to end the year. That was the first drop in three months.

A decline of 0.4% in the consumer price index (excluding food and energy costs) marked the smallest decline in two years helping somewhat reinforce the Bank’s latest prediction for a return to an annual rise in consumer prices through the next fiscal year end in March 2012.

The yen reversed Thursday’s decline inspired by a downgrade to its sovereign credit rating from S&P and gains were accelerated on news that the dollar faced a similar fate if it failed to get its house in order.

Following the U.S. GDP report the yen remains higher on the day at JPY82.36. It’s also firmer against the euro, which buys JPY112.85.

http://www.dailymarkets.com/forex/2011/ ... l-corners/

[winston]

Slowly creeping upwards. 82.03 now.

When will the Nikkei go into free fall ? Only down 1.2% today.