Posts Tagged ‘analysis’

Forex Talk In The Street ~Dollar Yen

I find it interesting, to note that the Yen has made its way “up” and through 84
Yen/dollar and that in the process it has broken a very, very well defined downward trend for the
dollar, a trend that was obviously in the Yen’s favor. Now that trend has been broken and not only that,
but we think the trend is reversing against the Yen and for the dollar.

Certainly Japan’s exporters would prefer this situation to the other, and so too does and shall the Bank of
Japan. The Bank was rumored to have considered intervening in the dollar’s favor, against the Yen, when the Yen/dollar rate was putting 80 to test, although it never actually
did intervene. Jawboning was sufficient to keep the Yen from strengthening further. Now, however, with the Yen weakening it would make far greater sense for the monetary authorities in Tokyo to come to the Yen’s “aid” and sell it now, for trading when the trend is in one’s favor is far easier and far wiser than it is to intervene contrary to the trend.
I would expect a pull back to 83.35, then a resumption of the trend for the Yen to Weaken. I have a target of 86.50 in the short term.

Talk In The Street~November 15th

The dollar on the  FOREX MARKET as the new trading week begins is mixed, for it has risen proportional to some of its major and
its minor currency trading partners while it has fallen comparative to others. Try as we might, notwithstanding, we see
little in the way of consistency in how the dollar has reacted since the end of the G20 meetings, for it has fallen relative to the EUR and Sterling, but it has risen relative to the Swiss franc; in other words it knows not what to do relative to Europe generally. If there is one consistency it is that currencies that are “China related”‚Ķ that is currencies where there is more Chinese trade related interest than in others‚Ķ such as the Yen and the Aussie and Kiwi dollars‚Ķ have weakened the most relative to the US dollar; otherwise
incompatibility reigns.

Concerning the G20 meetings, the consensus is that the Presidency has suffered a series of defeats at the meetings, coming home with little that was on its agenda to accomplish. We’ll not debate too greatly with that judgement, for the US went to the meetings hoping
to come away with rather strict numeric rules regarding trade deficits, budget deficits and the like and hoping too to come home with some consensus amongst the attendees that China’s currency policies were wrong and needed to be accompanied too.
The US may not have wanted to have China named directly in the post-meeting communiqu√©, but it diindeed hope that there might be some talk of “undervaluation”of the YUAN  at the very least. It got nothing of the sort.

To that end then the meetings were a disappointment, and for President Obama, who only a year and one half ago reigned exultant, having been adorned with a newly granted Nobel Peace Prize, they were a embarrassment. Reality is a harsh mistress. From my perspective, however, these meetings are always overhyped and the best that one can accomplish is to know that the lines of communication are always made more open amongst the attending nations, and that’s all we got was lip service!
Euro $ projected Range 1.3500-1.3820

GBP$  1.6190 1.5850.