From what I can understand, the g7 spike was aimed to cause usd/jpn to rise, to fill the liquidity gap. I guess this can be done by either weakening the yen or strengthening the dollar.
From looking at usd/chf, which also spiked upward, suggest that it is the strengthening of the usd
But then now is my question, if usd was getting stronger, then should aud/usd fall considerably? if it was the yen which was weakened, then why did aud/usd spiked upward, almost in sync with usd/jpn?
Shouldn’t the effect on dollar be opposite for these 2 pairs?
And if it was just the weakening of the yen, then why did aud/usd spiked too? For example eur/usd and gbp/usd didn’t spike upward.
Can someone who understand please tell me why? I got wiped out as I was expecting aud/usd to fall or at least not affected by the g7 meeting…
AUD is a commodity currency it follows Oil and Gold what happens to commodities when bad news happens? remember your trading pairs not just the dollar. that would be my take on it. I would try to stay away from predicting what something like a G7 meeting will do to a pair, its going to be unpredictable for us retail traders with a retail news feed.
The intervention wasn’t specifically to raise USD/JPY. It was to weaken the yen in general terms. AUD/JPY was one of the big losers in the yen rally. No surprise that it would recover that much more in the face of intervention.
One thing that I don’t know if anybody has noticed though (that would worry me): this so-called ‘news’ that the G7 was going to assist in weakening the Yen was only announced yesterday (well sometime last night my time). Take a nice look at the daily chart of USD/JPY. The first huge move up started the previous day. Simply by CHANCE???
And by the way John: you didn’t HAVE to look at my site but you didn’t have to just ignore my question about the NASDAQ / NASDAQ Futures???
Whoops! I remember putting that aside because I couldn’t come up with the answer immediately. Clearly it got lost in the jumble after that. To be honest, I’m not sure why the NAS spread is bigger. The spread is based on the cost of carrying the underlying portfolio, though. There must be something in that.