Russian central bank, Bank Rossii, announced that it will add Canadian and Australian Dollars to its foreign exchange reserves, in an effort to diversify the holdings. According to what Russian financial authorities disclosed, the foreign reserves are made up of 47 percent U.S. Dollars, 41 percent Euros, 10 percent British Pounds and 2 percent Japanese Yen. Russia’s international reserves, reached $458.2 billion on May 14 and are the world’s third biggest.
This is not the first time that the central bank of Russia talked about including the Loonie in their portfolio. In fact, they’ve discussing it for at least two years now, and, as we can see, this phase of the operation is still in “discussion” stage. Same for the Australian Dollar. Of course, including CAD in the reserve currency club makes a lot of sense. Comparing to many other countries, Canada’s budget is far less debt ridden and financial policies are more sound. In fact, some analysts are already saying that the Canadian Dollar is becoming a reserve currency. Now it remains to be seen if other countries accept it as such.
The last post covered possible short trade in Yen pairs, with AUD-JPY as an example. Wanted to use smaller time frame, like 15M, because the hourly chart simply didn’t provide a good stop, considering that objective would relatively small. The move came not too long after the post was published.
Trade took place at 78.40. At first, 78 was objective, but eventually it was extended by 10 more pips, so trade produced 50 pips. Price moved even lower, but reversed at the start of European session. After that was up for the rest of the day. Currently the AUD-JPY is back to 79. It will have to be watched as it approaches the last high at 79.60. The way things look right now, I’m inclined to look for short trades, using shorter term chart again. That will have to later in the day, as nothing is forming right now.
Kiwi looks a little under pressure. Hourly charts of its crosses are starting to look choppy, a possible sign of a reversal. The NZD-CHF already broke under the most recent low and then bounced off of the 100SMA. If the trentd is to turn south, that very spot might be a good place to set a sell order – 0.7845. Objective is not very large, just above next support, or 50-55 pips. Very much in line with the size of swings for this chart at current volatility.
Mike K.
You watching he games? What do you think so far – waka waka:)
Very little movement today. Are you still trying to sell the aud/jpy on reversal? Thanks!
Alex, so far I like it, Exotic setting, surprises, only the scoring could improve. Other than that-fun!
Yes Heather, I’ll cover it more in next post tomorrow. No time today.
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