Thursday, September 2, 2010

Maniacal dip buying by Japan retail investors on the 'risk' currencies (FX)

Like most risk currencies, or the high yielders such as the NZD, CAD, AUD. The extreme margin retail investors out of Japan feverishly (yeah word of the moment...) buy dips. So its like this, over leveraged traders in topped out markets chasing high risk/high yields when most risk is trying to be cut by institutional trades; what you get is a buy (retail) sell (institutional) and a daily basis. Until a large position is cut.

Essentially they (Japan retail FX traders) are keeping the market stabilized for bigger players, a tight spread forms with easy money being made (sells) on constant dip buys by the naive.

Below is the Canadian Dollar, the supported buys are most likely Margin/retail investors from Japan, hence smallish volume:

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