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Meet The New Regime: Welcome AUDJPY, Goodbye EURJPY

Tyler Durden's picture




 

Europe is now irrelevant, at least according to FX traders, and, well, everyone else. The gyration of the Euro currency, previously moving the market tick for tick, now exists purely in its own vacuum, as more and more hedge fund will unwind and outright liquidate positions. In order not to be caught facing some multi-billion macro fund with its pants down as it faces massive massive margin calls, the ever declining population of market participants has decided to shift the market signal to the AUDJPY, the last bastion of the carry trade. Anyone tracking the FX-ES trade will now need to recalibrate their models to be driven of the Aussie-Yen, and to completely disregard or materially mute inputs coming out of a bankrupt Europe.

AUDJPY - add:

EURJPY - fade:

 

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Thu, 06/24/2010 - 14:12 | 431836 trav7777
trav7777's picture

Welcome, bitchez

Thu, 06/24/2010 - 15:49 | 432108 -1Delta
-1Delta's picture

Oil traders have known this one for quite some time... try the CAD :)

Thu, 06/24/2010 - 14:15 | 431847 tempo
tempo's picture

Perfect call.  Thanks.  After retesting .854, AUD moved up quickly to .864 and pulled ES and NDX futures up.    Probably someone screwing with the algos. 

Thu, 06/24/2010 - 14:17 | 431856 Mitchman
Mitchman's picture

Meet the new boss...

Thu, 06/24/2010 - 14:55 | 431952 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

....same as the old boss!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Thu, 06/24/2010 - 15:09 | 431988 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I tip my hat to the new constitution/take a bow for the new revolution/small and grin at the change all around me!!!!!!!!

Thu, 06/24/2010 - 14:27 | 431878 Turd Ferguson
Turd Ferguson's picture

well, how bout dat

Thu, 06/24/2010 - 14:30 | 431886 jbc77
jbc77's picture

Tyler, thanks for keeping us up on this. As a close observer I noticed a few days ago the correlation appeared to coming to a close. Is this the ultimately signal of no faith in the euro or Europe?

Thu, 06/24/2010 - 14:34 | 431896 AR15AU
AR15AU's picture

I've successfully loaded the new cartridge into my Atari 2600.  Thanks,

Thu, 06/24/2010 - 14:37 | 431905 john_connor
john_connor's picture

Good, the AUD is approaching massive resistance, and the Yen looks ready to break out.

Thu, 06/24/2010 - 14:49 | 431935 Eric Cartman
Eric Cartman's picture

This is so tits.

Thu, 06/24/2010 - 14:52 | 431945 The Alarmist
The Alarmist's picture

The big mystery in all this is how the JPY remains a flight to quality currency.  Is it a case of Bag over the Head or enough Budweisers makes anything possible?

Thu, 06/24/2010 - 15:27 | 432030 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

All currentseas are but nothing more than hope.  See where that gets ya.

Thu, 06/24/2010 - 15:54 | 432123 BT310
BT310's picture

I welcome our new aussie overlords.

Thu, 06/24/2010 - 23:24 | 432798 London Dude Trader
London Dude Trader's picture

AUDJPY is far less liquid than EURJPY. That would imply ever increasing volatility in the already erratic ES when the algos are running the show. 

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tp123's picture

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