Might turn...Hourly 2/2/2006 17:58 119.1037 118.0213 2/2/2006 20:22 119.0439 117.9483 2/2/2006 22:46 118.9573 117.8474 2/3/2006 1:10 118.8437 117.7188 2/3/2006 3:34 118.6994 117.5584 2/3/2006 5:58 118.5437 117.3860 Daily Look dangerous to short this 117.5 is a major bottom for 1.22
GlobalFinancier thinks USD/JPY will go lower.(Thought so in my newsletter). But let's clear the scoreboard, spot at 116.20 now.
what's with all this bogus fear about the Yen carry trade unwinding.... no fear!... just keep buying US stocks!
Why is it a bogus fear? It makes sense to repay Yn borrowing as you might take a 3% hit in yield over the next few years and a 20% in currency depreciation. You might as well switch the borrowings to CHF.
I agree, so much so that I'm shorting (this session) the near month YEN future, expecting it to trade to or below .008500 this week or next. Shorting next month YEN (June) is even better in my view, because I believe Fed will go higher than two quarters to five. My shorts may suffer some roiling before that recognition takes hold in the market, when/if it does. So, I'll place stops no closer than 100 ticks away, or .008710 on average for near month shorts. Basic premise and prediction: by June, USD will reach and breach its December '05 high, with spot climbing above, say, 1.23.
No, the opposite. Last December, at the USD high, I thought the carry trade had oversold the YEN, which proved correct. All of the factors apparent at that time for the carry trade were past fully priced in. But the carry trade has powerfully bid the USD for 9 or 10 months, and I don't see that longer trend playing out for at least some months -- not with the latest US data (January forward) on jobs, inflation, and consumer spending. P.S. It may be semi hocus pocus, but it spends if you win it. No doubt that's how the carry traders look at it. My little pea shooter simply follows suit.