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5 Jun 2013
Flash: Japanese Prime Minister Abe’s speech –TD Securities
FXstreet.com (London) - TD Securities noted that the Japanese Prime Minister Abe’s speech on economic growth made mostly broad statements about reviving Japanese activity.
But they said the market seemed unsatisfied with the general statements and after a very brief rally, the Nikkei suffered a fresh round of selling and closed 3.8% lower. As usual, they say, USD/JPY traded in tandem with Japanese stocks, sliding to a low of 99.40. But added that while the intraday price action of USD/JPY and the Nikkei has been strongly correlated, the overall fall in USD/JPY since mid May hasn’t kept up with the Nikkei’s collapse.
This suggests to them that there might be some room for USD/JPY to catch up -with the massive speculative JPY short position at the moment (as per the CFTC report) a short squeeze could help see at least a couple more big figures lower in the coming weeks.
But they said the market seemed unsatisfied with the general statements and after a very brief rally, the Nikkei suffered a fresh round of selling and closed 3.8% lower. As usual, they say, USD/JPY traded in tandem with Japanese stocks, sliding to a low of 99.40. But added that while the intraday price action of USD/JPY and the Nikkei has been strongly correlated, the overall fall in USD/JPY since mid May hasn’t kept up with the Nikkei’s collapse.
This suggests to them that there might be some room for USD/JPY to catch up -with the massive speculative JPY short position at the moment (as per the CFTC report) a short squeeze could help see at least a couple more big figures lower in the coming weeks.