13 Jul 2015
USD/JPY: Taking up demand after Grexit bearish opeing gap
FXStreet (Guatemala) - USD/JPY is currently trading at 122.68 with a high of 122.71 and a low of 122.52.
USD/JPY has dumped on the back of a risk-off theme to commence the week with failures to reach a Greek deal over the weekend's Greek talks and fears of a Grexit that are mounting.
USD/JPY price action
USD/JPY dumped from last week's closing price of 122.48 to 122.25 on a bearish gap and has since made a recovery on demand and has closed the gap. Last week's bearish gap took 24hrs before it was filled for just over a 100 pip recovery before more selling pressures capped the bids and took the major right down to 120.50 and to the lowest levels since May 19th, at the top of the sideways channel that commenced in April and continued until 18th May's rally. On continued risk-off, the Yen may be favoured as a safe haven which could result in the same or even exceeding the previous bearish gap's subsequent supply on the gap's recovery, bringing in a break of the 120 handle. to the up side, 125.80 marks the recent yearly high.
USD/JPY fundamentals and Grexit time out
The weekend's Greek talks have not given us a concluding outcome for the Greek debacle that we have been living through for many reporting weeks as the saga heightened this year with EU leaders and Greece's creditors have been running impatient with them. The idea of a Greek deal and the premium that was priced in to the euro is being unwound at the start of the week and the Yen is benefiting from risk-off price action as markets get serious about the idea of a Grexit.
The Greek parliament have been given a deadline of 15th July to approve the legislation of which the the EZ is demanding. Richard Franulovich, Rob Rennie, analysts at Westpac Banking Corporation explained, "These heavy handed tactics are unlikely to go down well at all in Greece and risks a rebellion within Syriza should PM Tsipras try to push measures through Parliament...We view this as a last ditch "take it or leave it" deal that is likely to bring some finality to Grexit risk, at the cost of increased volatility and risk aversion in coming days."
USD/JPY has dumped on the back of a risk-off theme to commence the week with failures to reach a Greek deal over the weekend's Greek talks and fears of a Grexit that are mounting.
USD/JPY price action
USD/JPY dumped from last week's closing price of 122.48 to 122.25 on a bearish gap and has since made a recovery on demand and has closed the gap. Last week's bearish gap took 24hrs before it was filled for just over a 100 pip recovery before more selling pressures capped the bids and took the major right down to 120.50 and to the lowest levels since May 19th, at the top of the sideways channel that commenced in April and continued until 18th May's rally. On continued risk-off, the Yen may be favoured as a safe haven which could result in the same or even exceeding the previous bearish gap's subsequent supply on the gap's recovery, bringing in a break of the 120 handle. to the up side, 125.80 marks the recent yearly high.
USD/JPY fundamentals and Grexit time out
The weekend's Greek talks have not given us a concluding outcome for the Greek debacle that we have been living through for many reporting weeks as the saga heightened this year with EU leaders and Greece's creditors have been running impatient with them. The idea of a Greek deal and the premium that was priced in to the euro is being unwound at the start of the week and the Yen is benefiting from risk-off price action as markets get serious about the idea of a Grexit.
The Greek parliament have been given a deadline of 15th July to approve the legislation of which the the EZ is demanding. Richard Franulovich, Rob Rennie, analysts at Westpac Banking Corporation explained, "These heavy handed tactics are unlikely to go down well at all in Greece and risks a rebellion within Syriza should PM Tsipras try to push measures through Parliament...We view this as a last ditch "take it or leave it" deal that is likely to bring some finality to Grexit risk, at the cost of increased volatility and risk aversion in coming days."