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Slides With E-Minis

DOLLAR-YEN

USD/JPY trades at Y106.09, 9 pips shy of neutral levels after dipping into the UK midnight. The latest round of JPY purchases allowed the currency to jump onto the top of the G10 pile. Softening U.S. equity index futures continue lending support to safe haven currencies. Some further pressure may have come from cross-flows from AUD/JPY, which has sank through yesterday's lows.

  • This morning's weakness in e-minis builds on a poor showing at Wall Street yesterday, which stoked demand for safe havens. Both USD & JPY were bid against riskier currencies and USD/JPY charted a Doji candlestick.
  • Bears look for a fall through Aug 28 low of Y105.20, towards Aug 19 low of Y105.10, the intraday bear trigger. Conversely, a rally above Aug 28 high of Y106.95 would prompt bulls to target Y107.05, the high of Aug 13.
  • Japanese highlights next week include earnings/spending data, Eco Watchers Survey, BoP current account balance and final Q2 GDP (Tuesday), flash machine tool orders (Wednesday), core machine orders (Thursday), as well as PPI and BSI Large (Friday).

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