Asian Forex Wrap

Japanese Opposition Party maintains lead in polls. Swiss Government to sell out of its UBS stake. Citi Bank recommends shorting AUDJPY. Large Swiss name seen selling EURUSD above 1.4230. China H1 current account surplus $130 Bln, down 32% yr/yr. RBA sold net 299 Mln AUD/USD in July. Australia July merchandise imports up 6%. BOJ Mizuno says export recovery may slow. FX markets followed leads from the Chinese stockmarket. Gold unchanged at 942.00 Movements today in the FX world closely mirrored those on the Shanghai Composite. Early Tokyo names were seen buying EURJPY for a run up towards 134.40, however further gains were abated as a large Swiss bank repotedly sold EURUSD aggresively down from above 1.4230 to 1.4200 area. Demand for Yen crosses dried up post Tokyo fix, with EURJPY slipping back below 133.80 and USDJPY back towards 94.00. But regained moment as the Shanghai Composite opened up and continued higher, over 2.5% up at one stage. Risk was on again, EURJPY pushed up above 134.20, EURUSD held 1.4200 and USDJPY inched higher. Then the chinese stockmarket retreated, back to opening levels and traders sold down Yen crosses. It was a yo-yo ride in a very narrow range as traders looked for direction from China. AUDUSD held firm at the 8280 area catching a short market out to pop above 83c as AUDJPY traded up on the back of the Shanghai composite gains. However the 8320 area was unable to be broken falling back below 8300 to hold in the 90's. Stops reported above 8330 and technical traders looking to buy after yesterday's bullish outside day chart formation. Ranges: EURUSD 1.4204 - 1.4256 GBPUSD 1.6501 - 1.6564 USDJPY 93.95 - 94.40 EURJPY 133.73 - 134.39 AUDUSD 8273 - 8318