The index has shed 1 percent this week as some trimmed favourable bets on the dollar as U.S. bond yields eased. U.S. 10-year Treasury yields remain below the highs above 2.70 percent seen before last week’s U.S. payrolls data and the spread between similarly-dated German and Japanese bonds have narrowed in the past few days. That has prompted investors to trim long dollar positions.
The greenback later bounced back on position squaring, however, after running into bids near the 96.00 yen level. “The dollar is starting to show some firmness on the downside, at levels below 96.00 yen,” said a trader for a Japanese bank in Singapore. Market players said the near-term outlook for the dollar against the yen will hinge on U.S. economic data due this week, such as retail sales coming up on Tuesday, as well as moves in Tokyo share prices. The yen could be headed for further gains if Tokyo shares continue to weaken after the disappointing GDP data, said Satoshi Okagawa, senior global markets analyst for Sumitomo Mitsui Banking Corporation in Singapore.
Forex Strategy: Waiting to Get Long AUD/USD
The past period showed a 1.2 percent growth. This is the third consecutive month of positive data. Also at the same time Japanas Q2 Preliminary GDP Price Index y/y fell by 0.3 percent, compared to the forecasted 0.7 percent drop and the prior 1.1 percent decline. Japanas Revised Industrial Production m/m report was released at 05.30 BST, showing a 3.1 percent decrease, matching expectations. Japanas Prelim Machine Tool Orders y/y came out at 07.03 BST, revealing a 12.1 percent decrease in July, compared to the prior 12.4 percent fall.
Forex: Daily outlook: Swiss http://www.etftradingsignals.com retail sales expected to rise in June
Let’s compare the Telecom stock trade example above with a similar value trade in the forex market on NZDUSD. The total trade value for 10,000 shares at $2.29 was just shy of NZD$23,000 worth of stock. We can take a NZD$23,000 position on NZDUSD which gives us the same dollar value for a fair comparison. Let’s say the kiwi is trading at 0.7834/0.7837 – a 3 pip spread.
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