Risk Off Mood Sees JPY Surge Across The Board
Talking Forex | Jun 01, 2016 11:27AM ET
Risk off mood saw the JPY surging across the board. AUD suffered despite strong GDP overnight, while GBP selling continued as we enter June.
A sudden turn in risk sentiment prompted a surge in the JPY, prompting dislocated trade across the board. USD/JPY fell through 109.40-50 support, but held 109.00 lower down. AUD was the major loser after the overnight release of Q1 GDP shows a much higher than expected reach, anticipated to some degree by the export data reported the day before. We saw .7300 in Asia, but failed to get anywhere near this before the slow drift lower saw a push down to the lows of the day just under .7230. CAD was also on the back foot as energy prices – also to the detriment to AUD – added to the support ahead of 1.3000, and we have since pushed back above 1.3100 with the help of stronger than expected US manufacturing ISM. EU manufacturing PMIs were as expected, while the UK equivalent beat expectations, but to impact on GBP. Instead, the EU polls continue to dominate trade here, and while many have been warning of complacency, the ICM poll yesterday (showing a small lead for Brexit) has underlined the fact and we see the market pouncing on any retracement. Cable tried to gain some ground through 1.4500 but has since been smashed down towards 1.4400, with the figure level now looking extremely vulnerable. EUR/USD has moved into the middle of the 1.1100-1.1200 range ahead of the ECB meeting tomorrow, in line with the usual response to a risk off scenario. The Fonterra GDT index 3.4% with WMP -1.7% (inside the futures forecast range). NZD/USD was well supported through the day, with AUD/NZD selling also contributing to a pressured AUD spot rate as mentioned above.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.