FX Flows

From the FXWW Chatroom: One macro PM said it is hard to believe that Usd goes up in Asia today. She was right. The greenback started our session weak; soon pared losses after market switches attention to China. Then returned to negative.

Tokyo names were spotted buying Jpy-crosses early morning since they walked in. Aud, Nzd even the Euro and Gbp are up versus Jpy. UsdJpy rose to 112.81 and fell back to take out the 200-Hour MA of 112.51. Momentum funds said to be responsible for move to 112.39 – fixing demand (linked to Goto-bi Day) came and gone. Jpy-crosses ended the morning not quite as bid as when we started. UsdJpy ended the session high side of 112.40’s. We are not seeing much bids on the downside but hearsay buying comes in 112.20’s.

EurUsd tested 1.1300 and backed off. One interesting flow, saw 2 AAA names selling small Euros in the 1.1290’s. I’m reminded of strong level at 1.1330 and stops are talked about though 1.1340.

Keep an eye on this British news, circling the UK media about Tata Steel has decided to withdraw totally from British operations. Tata said it had ordered its European steel subsidiary to “explore all options for portfolio restructuring including the potential divestment of Tata Steel UK, in whole or in parts”.
This will put thousands of jobs at risk.

Started good for Aud, Nzd and Cad but all three pared gains by end of the morning. Aud and Nzd were given a “like” by Tokyo banks when they walked in but all that was purely due to positioning for Goto-bi Day fix. The only positive thing is SHCOMP, which is holding to a strong performance.

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