Eurodollar plunges in the Tokyo market

Recently, the dollar has been appreciating every day. The background is that expectations for an early rate hike by the US financial authorities are spreading due to the upside of the US consumer price index. Then, around noon in Tokyo today, the Eurodollar suddenly fell below the 1.1300 level and plummeted to 1.1260 units. The pound-dollar pair also fell below the $ 1.34 level at one point. Option-related transactions and short-term stop orders were observed. There was a scene where the yield on the US 10-year bond rose to around 1.65%, and there was widespread view that it triggered dollar buying.

However, the dollar-yen exchange rate is on the verge of the 115 yen mark, and trading is mixed. With the prospect of widening the interest rate differential between Japan and the United States, the Bank of Japan and the Bank of Japan are prominent in their stance of continuing easing along with the ECB with a negative interest rate, and the conditions for the dollar-yen pair to test the 115-yen level are in place. However, it seems that sell orders are on the horizon around 115.00 or just before that.

Currently, the plunge in the euro dollar and the pound dollar has stopped, and the dollar-yen exchange rate has continued to squeeze at the 114.80-90 level. In the ultra-short term, the dollar buying seems to have been sorted out to some extent, which may lead to a sense of immediate pause. I would like to pay attention to the subsequent trends in overseas markets.

Pay attention to whether the dollar / yen pair will break 115.00, and the EURUSD will hit the bottom around 1.1260, which will be a strong support.

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