Stopped-out of USD/JPY short - TDS

Analysts at TD Securities explained that they closed their USD/JPY short in our FX Model Portfolio after the stop-loss was triggered for a loss of ~2.  |  11/07/2018 21:23

Analysts at TD Securities explained that they closed their USD/JPY short in our FX Model Portfolio after the stop-loss was triggered for a loss of ~2.4%.

Key Quotes:

"We initiated this trade on the basis that trade tensions would worsen and undermine risk sentiment, both of which would weigh on 10yr UST yields. While this narrative largely played out, USDJPY has broken away from traditional correlation structures and has pushed higher instead."

"Indeed, our HFFV estimate suggests USDJPY should be trading closer to 109. Nonetheless, the JPY appears to be trading in sympathy with the pain observed in Asian FX (see ADXY chart). We do not see trade tensions de-escalating anytime soon leaving conviction to lean against the USD tide in the tactical sense low for now following a break of technical trend resistance located near 111.60/80 (established from the 2015 highs)."

"Though we think the breakdown in cross-asset correlations will not hold indefinitely, a break through technical resistance may exacerbate near-term positioning risks to the topside. This augurs for patience before fading the recent USDJPY upleg. For now, we hold a preference to express trade risks through CAD shorts."

Share

Popular News

Show More Popular News

Sentiment

Open a Demo Account Open A Live Account

Losses can exceed deposits

RISK WARNING

The information provided herein is for general informational and educational purposes only. It is not intended and should not be construed to constitute advice.

If such information is acted upon by you then this should be solely at your discretion and GKFX will not be held accountable in any way.

  • ForexF
  • IndicesI
  • CommoditiesC
        Back

        Login to Market Insight Account

        Your Market Insight account gives you access to the tools that we offer our customers including our
        Technical Studies & Sentiment for your accounts.

        Forgot Password?

        Don't you have a Market Insight account? With a few easy steps you can easily register to Market Insight

        Create a Market Insight's Account

        Your Market Insight account gives you access to the tools that we offer our customers including our Technical Studies & Sentiment for your accounts.

        register_ty

        Thank you!

        Welcome to Market Insight family!

        You have succesfully completed the registration.
        We will send you an e-mail to give you some
        instructions and our Terms and Conditions!
        Our account representatives will be contacting you as
        soon as possible. If you have any further questions
        please do not hesitate to mail us via info@marketinsight.com