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BOK

Yen tumbles to 139The Japanese yen has been pummeled today by the US dollar. USD/JPY is currently trading at 139.22, up 1.29% on the day. The US dollar is showing broad strength today, and for the yen that has meant a new 20-year low, as USD/JPY touched 139.39 earlier in the day. The symbolic 140.00 line is within striking distance, and it would certainly be memorable if the yen breaks 140 right after the euro broke below the parity line for the first time since 2000. There has been a parade of central banks announcing higher rates in the past day, notably the Bank of Canada, which surprised the markets with a massive 100bp increase, and the Bank of Korea, which raised rates by 50bp. This has put the Bank of Japan's loose policy further out of sync with the global trend of tightening, and this appears to be weighing on the yen. On Monday, the yen slid around 1%, triggering a response from Japan's Finance Minister Suzuki, who expressed his concern about the exchange rate at a meeting with US Treasury Secretary Yellen. We have seen this jawboning from Suzuki before, but the likelihood of the Ministry of Finance (MOF) intervening in the currency markets to prop up the ailing yen are remote. We have seen the yen cross the 120 and 130 lines without incident, and there is nothing magical about the 140 level either. I would note that there are mixed signals emanating from the MOF and the Bank of Japan, which lead me to believe that no intervention is being planned. Governor Kuroda reiterated on Monday that the central bank would take additional monetary easing steps as necessary in order to boost the fragile economy. Kuroda has said on occasion that a weak yen has its advantages, and it seems unlikely that a 140 yen will trigger any change in policy from the BoJ. There are no guarantees, of course, but I would submit that the MoF and BoJ have bigger worries than a weak Japanese yen.  USD/JPY has support at 135.82 and 135.06 There is resistance at the round number of 140.00, followed by 142.14
by OANDA
ridethepig | KOSPI for the Yearly Close📌 The beauty of Korea is revealing itself right on time... the breakout is difficult to maintain as can be seen on the yearly close, the slingshot which turned out to a correct play for buyers has unlocked the potential for a major rally in 2021. Capital has its eyes on Korea (and a few others) for the advantage in its currency (KRW) and economic mobility across the continent. For different reasons to India, but with well placed influence, Korea has the chance to really outperform in the next decade. EM Equities and currencies are going to provide a lot of opportunities for 2020: With that recognition behind us, I am going to be spending a lot more time in Asia for this chapter in the economic cycle. From 2020 - 2030 we are going to see a the great migration of capital from West to East. The ability for KOSPI to break 2,600 is showing how flexible the bid really is into the year close. We also have to take note of the differentiation of outside candles on the yearly: Here deploying capital to Korea for a strong move in 2021, though it involves some understanding of the relevant sectors (we will dig deeper into some single stock opportunities and sectors later in the month so start to prepare your charts). Thanks as usual for keeping the feedback coming 👍 or 👎
KRX:KOSPILong
by ridethepig
ridethepig | KRW for the Yearly Close📌 KRW for the Yearly Close This brings into an important consideration for review the long-term KRW chart, the plan chosen by sellers has been able to lure in late unaware buyers at the highs because of the simple nature of the impulse employed. By trapping the highs and aiming for the negative break in the yearly close, it is a very bearish sign. Moves like these, do not happen often and are noteworthy. Another Yearly outside candle which as a matter of fact, should fix itself towards 900. What is important for us to track here is the 'pressure' break which is being played after the Fed capitulation. So it is worth considering adding to shorts as this looks set to continue in 2021. 📌 Nevertheless, I will continue to go through the technicals across the board, before we dig into macro details together towards the end of year for a final talk shop. Thanks for keeping all the feedback coming 👍 or 👎
Short
by ridethepig
ridethepig | KRW Q3 Macro Flows📌 A short update here for those tracking USDKRW ... It has been a very slippery pig since the last update: Here buyers stormed into control and chose to occupy the bid protecting 1140 via Covid flows. The relieving of this profit taking has become a bit more enterprising possibly via the idiosyncratic spike in cases for the U.S. The next moves are cooked and almost ready to go... since the centralisation of EM FX has taken place, the board is forced to exchange in the same swing. Vaccine headlines are coming in from all angles, more fiscal and CB stimulus are also there for the last few days of July for markets to get stuck into. Typically we will see the ebb and flow in risk start by August, thin and choppy liquidity markets in the middle of summer make forr useful loading zones in calm waters. Thanks as usual for keeping the feedback coming 👍 or 👎
Long
by ridethepig
1
ridethepig | KRW 2020 Macro MapKorea's economy looks set to be forming a meaningful floor in Q4 and with a helping hand from a temporary pause in protectionism we should see KRW remain in bid for the first half of 2020. For the domestic story, Korean exports have fallen which spilt over to the demand side. With this in mind, should the USD devaluation / reflationary theme pick up pace for the first half of 1H20 it will mean repricing in KRW. On the monetary side, cuts are widely priced from BoK for January. Fundamental risks to the thesis com from US-China trade and the significance of USD devaluation. On the technicals, a textbook Steel Resistance has held at 1219.xx after completing an ABC target sequence. Very high odds a meaningful top is in place and invalidation to this count comes in above 1200. Thanks for keeping the support coming with likes, comments, questions and etc. Another round of 2020 FX maps coming over the next few sessions. For those wanting to dig deeper with the 2020 strategies: NZDUSD USDJPY EURUSD EURSEK USDCNY
Short
by ridethepig