Mizuho Corporate Bank

EUR
Comment: All terribly neat as we consolidate at these historically very high levels. We shall continue to favour more consolidation this week. Note that already the Euro is no longer overbought and at-the-money implied volatility has eased somewhat.

Strategy: Possibly attempt tiny shorts at 1.4655/1.4700; stop above 1.4765. Target 1.4545, maybe 1.4445.

EUR/JPY
Comment: Massive intra-day price swings as the market seeks direction and investors ponder liquidity issues. We shall be looking for signs of topping at current levels for a move lower later this month.

Strategy: Sell at 163.15; stop above 164.00. Add to shorts on a sustained break below 160.50 for 158.70 short term and an awful lot lower further out.

GBP
Comment: Bouncing neatly from 2.0500, as expected, and should hold above here all week. Expect more correction and consolidation with the 2.0900 area probably capping on a first attempt.

Strategy: Possibly attempt small shorts on a rally to 2.0850/2.0900; stop above 2.1075. Cover ahead of 2.0525.

JPY
Comment: Rallying towards 112.00, as expected, and likely to continue to do so again today. A sustained break above 111.50 will probably set off another round of short-covering. Note that the US dollar is no longer oversold. Note that we currently expect USD/JPY to hold above 109.00 for at least a couple of weeks. Rallies to 112.00, and probably no higher than 114.00, are seen as medium term selling opportunities for a move a lot lower around year-end.

Strategy: Attempt small shorts at 111.30; stop well above 112.00. Short term target 110.00.