Yen now and through the summer

Discussion in 'Forex' started by Chood, Jul 4, 2005.

  1. Chood


    Looking for insight and predictions from experienced traders (not touts or shills, and certainly not "Coinz") on Yen moves through the summer, namely for a position of 2 or 3 months duration.

    My sense is that US treasury inflows of foreign capital, which normally are much lower in the summer than any other time of year, will prompt a Yen rally to at least 106 range. In that scenario, rally basis would be re-run of last fall's lead up to, and immediate aftermath of, the presidential election, when USD fell and fell on fear that foreign buying would not keep up with the structural US deficit. Comments anyone?
  2. Honestly, it is my thought that the CA problem will come into focus with all currencies, inciting a rally to mid term levels before any more info pans out. I agree with your thoughts overall, and would add the geo-political concerns of a growing issue in Iran, and Greenspan's leaving to the uncertainty - replacing the election of last year.

    Remember, in general, people WANT to hate the USD. All they need is a viable reason.
  3. Chood



    Looks like we're the only two Board members interested in position trading the USD, in my case with the Yen. (By the way, did you find a trustworthy fx dealer? Recall my post about the dealer who burned me.)
  4. himself


    I'm long the yen, too big, and underwater.
  5. I agree that Yen would be a buy, on several reasons (some of which I've outlined in prior posts)

    Anyway, I don't get it, I really don't.

    E.g., in today's 6mo US debt auction, 40% of the issuance was absorbed by Foreign Central Banks. Not by "real" investors, just mindless, price-insensitive buying by government agencies (foreign central banks).

    Also today, ALL commodities (except the "monetary metals" of gold/silver) are ON FIRE:
    oil +1.4%
    natural gas +4.5%
    corn +8%
    orange juice +5.5%
    soybeans +5.8%
    wheat +4.3%
    lean hogs +2.8%
    copper +2.9%

    At the same time, all currency pairs vs USD are FALLING. Not just today, but falling hard for MONTHS. So these basic goods become EVEN MORE EXPENSIVE for the citizens of those countries, day after day. Not just energy/oil/natgas.

    So, WHAT ARE those countries thinking (mainly Japan in this case), when they're continuing "vendor financing" of US absorbing and rolling-over USDs held by their Central Bank, YET let their own currencies DROP even lower every day, despite the huge rise in practically all commodities.

    Japan could liquidate parts or whole of the 750bn USD accumulated during previous years' interventions, let USD/Yen go to 105 and soften the blow on their citizens.

    TANKAN report 1-July-2005 said big Japanese manufacturers were still counting for USD/JPY at 103-104 for 2005 (and right now it's at 112), so it can't possibly be in order to "protect exports" by employing mercantilistic policy.
  6. naz9403


    Not an uptrend for the usd vs the yen just yet. However, long term the down trend would resume at near 102 levels and to sustain below 102 would be more difficult in my opinion that for this move to keep going to my uptrend mark which is at 117 area.

    Summary, more upside to the dollar than yen technically speaking.

    As far as fundamentals, i don't follow as much as some others might so i'll leave that up to them
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  7. naz9403


    Monthly chart possibilities
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  8. himself


  9. naz9403


    1. You can never tell real time where it will go first, you just have to wait and see

    2. Currently flat, no positions taken until my uptrend mark is reached. Or short on new lows of below 102
  10. Chood


    #10     Jul 5, 2005