The Bank of Japan and the Yen (Apr 9)

I keep saying the BOJ is going to intervene and I suggest avoiding shorts on the Jpy pairs but apparently the BOJ either does not will or simply cannot intervene. This week the Usd/Jpy broke an important level of support that was going back to the beginning of February. The initial down move started on Feb 1st and the pair dropped 1100 pips in just 2 weeks, then it remained in a range and then again starting March 29th it dropped another 600 pips. It is interesting to note that a G20 meeting took place in Beijing end of January.
Another issue that was in the news this week was the so called Panama Papers. Journalists were able to obtain some 11 million documents from a Panama Law firm that is specialized in offshore companies. The prime minister of Iceland resigned when it was revealed that he was taking money out of his country when the economy was collapsing and PM Cameron was obliged to change his initial statement of “I have no idea” to “Yes I had shares in an offshore company in Panama”. You can read more about it in the this link from the Guardian.
A very interesting book about offshore companies is “Treasure Islands” from Nicholas Shaxson where is very clearly explained who is really behind those offshore companies. In 2008 Citigroup had 427 tax haven subsidiaries, Morgan Stanley 273 and News Corporation (a media company) 152. 1/3 of those offshore companies belong to mobsters but the 2/3 are subsidiaries of well known companies like Google and Apple.

​I took a trade on Gbp/Aud on Tuesday and I closed it on Wednesday for a profit of 180 pips and I achieved 1/3 of my monthly goal. Unfortunately my open trades are still under water and I am little bit concerned with my Usd/Jpy longs.

I remain negative for the Gbp and I expect it to move lower. This week the currency lost 122 pips (according to my statistic tool) and the Gbp/Jpy was the mover of the week with -612 pips. Despite the AUD losses this week (-180 pips) I remain positive for the currency and will keep an eye on all AUD pairs. Aud/Usd for longs and Eur/Aud, Gbp/Aud for shorts. With a particular affection for the last one.

 

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