July 27th 2016: Yen Retreats (and bounces)

• First thing this morning, the Japanese yen staged a significant retreat, pushing the yen pairs higher. As we move through the morning, we are seeing this early move retreat. Yen pairs are still higher than yesterday, but the advantage is narrowing.

• The US Dollar is on the rise after a mixed reception for Apple’s earnings last night.

• Meanwhile, the Australian dollar is under pressure despite in-line CPI data.

• We’ve a busy day ahead today, starting with European M3 money supply.
• This is followed by UK preliminary GDP where we get to see any early impact from Brexit. CBI realised sales follow at 11.00.
• US Core Durable goods follow at 13.30, with pending home sales at 15.00.
• Crude oil inventories follow at 15.30, with the FOMC statement at 19.00.

Trade Idea: 

• It might be too early to assess the true impact of Brexit, but today’s UK GDP figures will make for an interesting read. With this and the US FOMC meeting later, we could see some significant movement on the GBP/USD which has remained range bound recently.

• A good way to play this is an IN/OUT trade predicting that the GBP/USD will close outside of either 1.3500 or 1.2800 in 14 days time for a potential return of 157%. 

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