Forex Market Update: Japanese Yen Cross Advance Across the Board

[B]USD/JPY and the JPY crosses firmed up[/B] amid good Japanese investor demand. Nikko Cordial launched a 55 billion China fund, which was fully subscribed and added to the heavier JPY tone. Japanese retail demand featured over the last session or two in anticipation of strong investor demand at next week’s investment trust launches. USD/JPY traded in to 97.00 and was also aided by a bullish cross yesterday when the 100-dma moved above the 200-dma and Tom De Mark technical signals indicated a bullish reversal. Japanese order books were skewed to higher levels, with bids building under 96.00 and offers few and far between on the topside. Exporter interest is reportedly staggered in to 97.50, but stop losses are also mixed in. On the flip side, Japanese U.S. bond traders are said to be nervous ahead of next week’s U.S. treasury record $104 billion auction, particularly after the slide in U.S. bonds after last week’s auction. Traders in Tokyo are nervous of risk of a similar sell-off next week with $104 billion in 2-yr, 5-yr and 7-yr debt on auction and possible impact on USD/JPY. Elsewhere, EUR/JPY is probing 135.00, GBP/JPY moved in to 158.50, AUD/JPY traded above 78.00 and NZD/JPY hit 61.90 highs.

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