Just thought I'd mention this from Thomson:
[23:43 EUR/JPY Buoyant, Holding Below 137, Break Possible With EUR/USD] Tokyo, Nov 5. EUR/JPY remains relatively bid, trading up to 136.78 in London overnight before easing back to the 136.50 area seen currently. What EUR/USD does from here will weigh heavily on the cross. An EUR/USD break above 1.2900 could potentially take EUR/JPY through 137.00, if only briefly. The EUR/USD rally overnight stalled just two ticks short of 1.2900, mostly on the back of defense of large option barriers there. With more smaller option barriers noted just above, stretching all the way up to 1.3000, a break could push the cross up towards next resistance in the 137.50-60 region, highs dating back to September 28. With USD/JPY likely to trade down as well, the move will unlikely be extended and the trade may be an ideal level to set up fresh shorts. There is already talk that some Japanese players, including exporters, are eyeing more sales in this 137+ area.
[23:29 USD/JPY As Low As 105.68, 105.50 Barrier Defense Still] Tokyo, Nov 5. USD/JPY traded down to as low as the 105.68 level overnight before rebounding on a general USD rally on the back of a big rally on Wall Street. The market may have found itself a bit short as well, pushing the market lower through stops below 105.90 and 105.75. Defense of an option barrier at 105.50 expiring today in New York proved to be rather aggressive, and no doubt contributed to the rebound as well. The rebound high in New York has been limited to the 106.10-20 region, and this area is likely to shape up as intra-day resistance in Tokyo. Even if this level is pierced, the 106.50-60 level just above will prove hard to break with those Japanese players unable to sell on 107 or above likely to have moved their offers down to this area. This would necessarily include Japanese exporters who still have to hedge out receivables for the January-March quarter. Downside support is eyed at 105.65-70, the overnight low, and then at 105.50. Large stops are eyed below this latter level. Next support is eyed at 105.00-10. Although some 105.00 option barriers expired yesterday, plenty more are seen at this level. USD/JPY currently trades 106.03/06.
USDCHF closing in on historical lows too.
- when I see it as a range extension - quick running of stops only - but with immediate pull-back - not making any breaches - and being clear it's a get-in-opportunity. It might go back there several times - but as long as it's clear it won't breach - just play the range - I think it's "safe enough". The advantage of this is that I can get out in the middle of the range - or with very small losses depending on average entry.
