WorldWideMarkets Community

Forex Trading, Market News & Technical Analysis

THURSDAY, FEBRUARY 11, 2016: THIN USD/JPY DIPS UNDER 111.00

Posted by Marge Maresca on Feb 11, 2016 7:23:10 AM

yen211.png

Overnight events

• USD/JPY free-fall to 110.99 before lifting to high 111s
• USD/CHF hits 4-mth low of 0.9661-Safety flows cited
• European banks shares slump-DB was down 8% at worst
• DAX off 2.5%, Brent off 1.0%, Gold up 2.7%, DXY off 0.25%
• Riksbank cuts 15-bp to -0.5%-Upper end of mkt expectations
• EUR/SEK jumps to 9.6145 then fall to 9.50
• Riksbank’s Ingves-negative rates working well
• SNB’s Jordan-tying CHF to basket makes no sense-Bilanz
• CH Jan CPI y/y -1.3% vs -1.3% prev, -1.3% exp
• UK Rics Jan Hse PxBal +49 vs Downwardly Rvsd Dec +49, +52 exp
• UK Rics-Hse demand up due to buy-to-let Inv seek to avoid Apr tax rise
• Moody's Comfortable With NZ AAA Rating - Moody's Senior Vice Pres.
• UK CBI Cuts 2016 GDP F.cast to +2.3% (Nov: 2016 2.6%)

Today’s events

An expiring FX option heading into the New York Cut, if close enough to the strike price, can act as a magnet for selling/buying.  If the option is large, it can generate enough trading to move the market.  

Option Expirations(Source:ThompsonReuters)

• EUR/USD: 1.1300 (146M)
• GBP/USD: 1.4600 (265M)
• AUD/USD: 0.6975 (402M), 0.7000 (144M), 0.7025 (325M)
• USD/CAD: 1.3900 (445M), 1.3800 (180M)

Chart - (Source:ThompsonReuters)
USD/JPY could drop to mid 106.00s
 
USD/JPY bears now eyeing 110.35 – 61.8% retrace of 100.76 to 125.86 (2014-2015) rise – a break and close below which on a monthly basis would unmask 106.68 – 76.4% retrace of 100.76 to 125.86. The 106.55 level – 38.2% retrace of the 75.31 to 125.86 (2011-2015) massive recovery - has also become a bear target which is very close to the 106.68 level. Our recent view for a deep fall in spot has proved correct, with the breaks of 113.93 - 23.6% retrace of the 75.31 to 125.86, 113.31 – 50% of 100.76-125.86 range and Nov 2014 112.42 low. These broken levels have severely weakened the market structure. Fourteen-month momentum is currently very negative for February and is a great risk on registering this negative reading at the end of the month. Chart: http://tmsnrt.rs/1QafCxM

Economic Data(Source:Bloomberg)feb11data.png

 

 

Topics: US MARKET OPEN

 

Tools & Educational Resources

Forex 101LEARN MORE >>
Learn the basics of Forex and how to practice trading the markets.

GlossaryLEARN MORE >>
Confused by the language? Click here and search for key trading terms.

FAQ CenterLEARN MORE >>
Browse our frequently asked questions and find your answers right away.

VideosLEARN MORE >>
Access to the educational lessons, webinars and platform walkthroughs.

READY TO TRY THE MARKETS?

Get started with a FREE $10,000 Demo Account and experience the Forex Market RISK FREE!