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28 May 2013
Flash: USD/JPY follows Nikkei while AUD shorts double - OCBC Bank
FXstreet.com (Barcelona) - Emmanuel Ng of OCBC Bank notes that USD/JPY´s prospects appear to be lead by price action in the Niklkei while on the CTFC front, AUD shorts more than doubled last week.
He begins by noting that the Nikkei’s movements may continue to be a near term determinant for USD/JPY prospects and yesterday’s BOJ minutes afforded some room for JPY strengthening after revelations of some doubts about achieving the central banks 2.00% inflation target. However, he thinks that the structural arguments for JPY vulnerability may continue to prevail. As such, the century mark for the USD/JPY may continue to hold on downside probes barring another Nikkei meltdown while any move back above 102.00 may see an attempt back towards 103.30. Moving to AUD/USD, he adds that speculative CFTC positioning on the AUD showed AUD shorts more than doubled in the latest week and markets may continue to focus on the capitulation in the resource cycle, leaving the AUD vulnerable. He writes, “In the near term however, the AUD-USD may continue to test the 0.9580/00 floor with some hesitation given that this area represents a 12-month low.”
He begins by noting that the Nikkei’s movements may continue to be a near term determinant for USD/JPY prospects and yesterday’s BOJ minutes afforded some room for JPY strengthening after revelations of some doubts about achieving the central banks 2.00% inflation target. However, he thinks that the structural arguments for JPY vulnerability may continue to prevail. As such, the century mark for the USD/JPY may continue to hold on downside probes barring another Nikkei meltdown while any move back above 102.00 may see an attempt back towards 103.30. Moving to AUD/USD, he adds that speculative CFTC positioning on the AUD showed AUD shorts more than doubled in the latest week and markets may continue to focus on the capitulation in the resource cycle, leaving the AUD vulnerable. He writes, “In the near term however, the AUD-USD may continue to test the 0.9580/00 floor with some hesitation given that this area represents a 12-month low.”