Thought it about time we had a separate thread for currency plays.

Charts Currently Removed - New Ones To Follow Soon

Good Reading If You Like FX
http://www.mizuhobank.com/fin_info/exchange.html

LONDON, May 19 (Reuters) - The dollar slid to its weakest against the yen in more than three months on Monday as expectations of higher U.S. interest rates faded. The pound faced pressure from signs a major merger will fail. The yen's break past 101.20 yen per dollar JPY=EBS was the first time since November that it has traded stronger than its 200-day moving average. In nominal terms, it is the strongest since early February. That reflected both a dip in U.S. treasury yields in the past week and the dollar's broader failure to deliver the strength many had expected this year. But dealers said there were options barriers around 101.00 and talk of official buyers in Japan around 100.80 yen. That will block any further push before a two-day meeting of the Bank of Japan starts on Tuesday, they said. "There does seem to be a lot of daylight above these levels, but around here I've gone into wait-and-see mode," said one London-based currency dealer. "I'm not quite sure if the market has the energy at the moment to follow through on these kinds of moves. There do seem to be bids around 100.80/100.75 and we have the BoJ meeting coming up as well." The yen reached as high as 101.10 in morning trade in Europe before steadying. "The chief reason is the slide in U.S. 10-year yields," said Alvin Tann, a currency strategist with Societe Generale in London. "I wouldn't be surprised if we got down to levels of 100 to 100.5." It has been a choppy couple of weeks for major currency markets, hamstrung this year by a lack of clear differentiation between the economic stories of Japan, Europe and the United States. Growth is now moving at different rates, although official borrowing costs in all three remain near rock bottom. Signs the European Central Bank is preparing to loosen monetary conditions even further knocked the euro back last week. The single currency gained 0.2 percent on Monday to $1.3717 EUR= after a volatile session on Friday. Analysts from Credit Agricole said that the euro's resistance to further losses at the end of last week raised prospects it may head higher. "This week's focus will be on PMI releases, which we expect to confirm a trend of further improving growth conditions," they said in a morning note. "Under such conditions, position squaring-related EUR upside cannot be excluded. We advise against selling the single currency around the current levels. From a broader angle, however, we expect rallies to remain a sell." PFIZER BLOW Merger activity around a handful of Britain's biggest companies has been one factor helping sterling this year, and some dealers said AstraZeneca's AZN.L rejection of Pfizer's PFE.N latest bid could put some pressure on the UK currency. The pound's performance gave little sign of it by midday on Monday, however. Sterling, one of this year's better performers among the majors thanks to an improving economy, fell just 0.1 percent versus the euro and was almost unchanged against the dollar. GBP= EURGBP= "There are people talking about sales of the pound after this news," said one London-based currency dealer. "I don't know if that's because Pfizer had genuinely done some of this business or just because some people had been betting on it, but it would be a disappointment." Investors also await minutes later this week of the Federal Reserve's April 29-30 policy meeting, as well as a private survey on China's manufacturing sector for May. ECONUS ECONASIA The dollar index stood at 79.952 .DXY , down slightly on the day after notching up a modest 0.2 percent gain last week, when it touched a six-week peak of 80.338 on Thursday. Commodity currencies were sluggish as well with the Australian dollar just a touch lower at $0.9353 AUD=D4 following a flat week. Traders said the 94 U.S. cent level is still providing a cap for the Aussie for now.

LONDON, May 20 (Reuters) - The euro fell to a 16-month low against the British pound on Tuesday, hurt by widening short-term interest rates in favour of the pound before UK data that is likely to show an uptick in the inflation rate. ECONGB In contrast, the European Central Bank is grappling with falling price pressures and is likely to ease monetary policy next month. The euro fell to 81.25 pence EURGBP=D4 , its lowest since January 2013 and down 0.3 percent on the day. Bids from macro funds and corporates are cited at 81.10-8.15 pence. Sterling was up 0.2 percent at $1.6845 GBP=D4 .

Still holding GBP/USD short @ 1.67664 no other currency positions currently.

GBP/USD gone short @ 1.69116. With my existing play I now average 1.68390.

LONDON, May 21 (Reuters) - European stocks were under pressure on Wednesday, spooked by overnight falls on Wall Street, and the dollar fell against the yen as the Bank of Japan suggested the world's third largest economy needed no additional stimulus for now. A broad flight to quality helped push low-risk German Bund futures higher and weighed on lower-rated euro zone debt. Gold, also sought as a safe haven, held steady. Europe's FTSEurofirst 300 share index .FTEU3 was down 0.02 percent by 0815 GMT, extending the declines of recent days and taking it further away from the 2014 peak it hit last week. Rallies in European shares have paused on signs the economic recovery is stuttering. Elections to the European Parliament in coming days are being watched closely for any impact on reforms in several countries. "We have seen since last Thursday some corrective action in (low-rated euro zone bond) markets ahead of the EU elections. This can go further," said Matthias van der Jeugt, a fixed income strategist at KBC. The fall in European shares followed a 0.2 percent drop in Tokyo .T and a broad selloff on Wall Street .N , in which Caterpillar CAT.N dropped 3.6 percent after the heavy machinery company said "retail statistics" for the three months to April were down 13 percent. Tuesday's fall took losses in U.S. stocks to more than 1 percent since the Dow and the S&P 500 hit record closing highs on May 13 as investors seek confirmation the U.S. economy is accelerating. The BOJ kept monetary policy steady, as expected, and signalled its aggressive stimulus was helping broaden the economic recovery. Governor Haruhiko Kuroda was optimistic Japan was on course to meet the bank's inflation target. ID:nL3N0O70S6 Later on Wednesday, Federal Reserve chair Janet Yellen speaks in New York and the U.S. central bank will release the minutes of its latest policy meeting. Most market participants do not expect any solid clues on when interest rates may rise. Benchmark U.S. 10-year Treasury yields US10YT=RR dipped in Europe to 2.51 percent, close to half-year lows. Comments from a senior Fed official that the central bank would be "relatively slow" in raising interest rates saw the dollar fall to a 3-1/2 month low against the yen JPY= FRX/ . "Kuroda's comments are lowering expectations of further BOJ stimulus and there is position squaring going on which is driving dollar/yen lower," said Manuel Oliveri FX strategist at Credit Agricole. "At the same time one has to be cautious about the FOMC minutes with Yellen also due to speak later in the day." EURO BOOST The drop in U.S. yields also helped the euro, which rose 0.15 percent to $1.3717 EUR= , pulling away from a 2-1/2 month low of $1.3648 hit last week on expectations the European Central Bank will ease monetary policy in June. German Bund futures FGBLc1 rose and cash 10-year yields DE10YT=TWEB edged lower, while yields on 10-year Spanish and Italian bonds each rose 9 basis points to 3.17 percent and 3.33 percent respectively. Weaker shares burnished gold's appeal as a hedge and the metal held steady below $1,300 an ounce. Brent crude oil futures LCOc1 edged up towards $110 a barrel as U.S. crude inventories fell and on renewed violence in OPEC producer Libya.

May 21 (Reuters) - Sterling jumped half a percent on Wednesday on the back of a strong batch of retail sales figures and minutes from the Bank of England's last meeting that showed some policymakers leaning closer to raising interest rates. The pound jumped to 16-month highs against the euro EURGBP=D4 in the run up to the figures and minutes' release at 0830 GMT and extended gains immediately afterwards to trade as strong as 81.03 pence per euro before steadying. Against the dollar GBP=D4 , it hit a two-week high of $1.6922 after the figures showed retail sales surged 6.9 percent year-on-year in April, far more than expected. Gilt futures FLGcv1 turned negative and were last down 20 ticks on the day. The yield spread between 10-year British and German government bonds rose by around 3 basis points to 128.5 basis points, its highest level this week.

Easy sell signal on the 15 min, lets not forget the FED minutes later today which could well knock Sterling off its perch.

GBP/USD 1.69116 closed @ 1.68803 +31.3pts

Maybe the sale was a little premature!

LONDON, May 27 (Reuters) - Sterling sank as much as 0.4 percent against the dollar and euro on Tuesday after weak lending data added to concerns over a European election win for the anti-EU UKIP party. Dealers said the pound, little traded during a UK and U.S. holiday on Monday, was also hurt by Pfizer's PFE.N formal confirmation on Monday that it was abandoning its attempt to buy AstraZeneca AZN.L for nearly 70 billion pounds ($118 billion) "There is a mix of factors behind this morning's move," said one senior London-based bank dealer. "Certainly the failure of the AstraZeneca deal is one element. We have also probably taken a knock from the election result." UKIP, which wants Britain to leave the European Union, took almost a third of the vote in the EU polls. That prompted the party's leader to target holding the balance of power after next year's UK parliamentary election, which polls suggest might produce no outright winner. Sterling has been one of the hottest picks among major currencies since the second half of last year, buoyed by expectations an accelerating economy would prompt the Bank of England to raise interest rates next year. Some BoE officials have sought to temper such expectations in the past month and data on Tuesday showed Britain's banks last month approved the lowest number of mortgages since August last year. Sterling later recovered ground, however, to trade just 0.1 percent weaker on the day at $1.6833 and 81.08 pence per euro. DOLLAR STRUGGLES The dollar fell 0.1 percent against a basket of currencies .DXY , extending weakness since the end of last week after another retreat in U.S. bond yields. A stronger dollar was one of many investment houses' major bets at the start of this year but the U.S. economy has so far failed to deliver the comprehensive pickup that would convince the Federal Reserve it needs to raise dollar returns next year. U.S. two-year bond yields have fallen around 10 basis points in the past month despite a blip higher at the end of last week, and are less than half their British equivalents. "The dollar continues to struggle, and you can see that in the U.S. rate curve and rate differentials which haven't moved in the dollar's favour," said Stephen Gallo, European head of FX strategy with BMO in London. "If the data, starting with durables today, does not show the beginning of a more encouraging bounce back from Q1, then the dollar is going to continue to struggle," Gallo added. A raft of U.S. confidence indicators as well as orders for durable goods are due out on Tuesday, starting at 1230 GMT. The dollar lost 0.16 percent against the yen JPY=EBS to stand at 101.80 in early European trade. It fell almost 0.3 percent against the Australian dollar AUD=D4 and 0.2 percent against sterling GBP=D4 . The euro EUR=EBS held on to most of Monday's gains, largely the result of relief that the EU elections did not deliver a knockout blow to any of the bloc's more fragile, debt-ridden governments. Traders said a squeeze in short euro positions had given the euro some support overnight as it managed to stay above major technical markers such as its 200-day average against the dollar and 100-day average against the yen. "It's a sad reflection of the lack of volatility in FX markets that we now report 30 point moves as being newsworthy," said Sean Keane, a director of Triple T Consulting and formerly a markets trader at Credit Suisse. Prospects of policy action from the European Central Bank at its June 5 meeting have weighed on the common currency in the past few weeks and comments from ECB chief Mario Draghi on Monday reinforced those expectations. ID:nL6N0OC24U Reuters reported earlier this month that the ECB is preparing a package of policy options for its June meeting. It includes cuts in all its interest rates as well as targeted measures aimed at boosting lending to smaller firms.

My final currency position GBP/USD 1.67664 has just edged into profit. I'll leave this to run for now. I'm currently debating on shorting GBP/JPY and maybe placing a long position on GBP/EUR.

Cable short closed @ 1.67350 for +31.4

LONDON, May 29 (Reuters) - Sterling was little changed on Thursday after an early dip, with traders pausing during a week of heavy selling that has put the currency on track for its biggest weekly fall in over two months. Figures this week showed Britain's red-hot housing market may be cooling, prompting some of the more aggressive bets on the timing of the first Bank of England rate hike to be scaled back. That helped pull the pound back from a recent 5-1/2 year peak against the dollar and 18-month high against the euro. The selling continued early on Thursday but traders' appetite to push it lower quickly evaporated. Still, barring a continued recovery through to the end of the week, the pound will post its biggest weekly fall against the dollar, euro and on a trade-weighted basis since mid-March. "We had reached a sweet spot in terms of UK macroeconomic data and sentiment," said Neil Jones, head of hedge fund FX sales at Mizuho in London. "But the market is still fundamentally and structurally long (of pounds), so I think this weakness is only temporary," he said. Sterling fell as low as $1.6691 GBP= early on Thursday, but by 0850 GMT it had recovered to $1.6735, up slightly on the day. On Wednesday, the pound fell 0.6 percent, its biggest one-day fall against the dollar in almost four months. The pound was unchanged against the euro at 81.32 pence per euro EURGBP= . The trade-weighted value of sterling, a BoE measure of the currency's value against major global trading counterparts, was at a two-week low of 86.70 =GBP . That index is down more than half a percent this week, on for its biggest weekly decline since mid-March. Financial markets still widely expect the BoE to be the first major central bank to raise interest rates following emergency post-crisis rate cuts to virtually zero. But that may not happen this year, as some traders had started to speculate. The consensus in a Reuters poll of economists on Wednesday showed the first rate hike is likely to be some time in the second quarter of next year, although at least one rate-setter will break ranks and vote for a move by August.

Looks like its dropped back into the downside trend, some short term support at 1.6704. @ 1.6765 or above being the upper trend line I'm looking to short again.

EUR/GBP 0.81321 gone short.

LONDON, May 30 (Reuters) - Global shares steadied on Friday after hitting record highs as investors positioned cautiously on the last trading day of the month, with the market's focus on next week's European Central Bank policy meeting. The MSCI world equity index .MIWD00000PUS , which tracks shares in 45 countries, was down 0.04 percent after scaling a new lifetime high earlier in the session as investors positioned to shield themselves from any disappointment from the ECB, which is widely expected to ease policy significantly on June 5. ID:nL6N0O05MM "The market will hold at current levels until the ECB meeting next week. Should the ECB disappoint the market, then I expect a negative reaction and equities will run into a consolidation that could hold in the summer months," Christian Stocker, equity strategist at UniCredit in Munich, said. The pan-European FTSEurofirst 300 .FTEU3 was down 0.1 percent, with BNP Paribas BNPP.PA leading the index lower after a report saying the U.S. Justice Department was pushing the French bank to pay more than $10 billion to resolve a criminal probe. BNP shares fell 4.9 percent. ID:nL3N0OF455 Germany's DAX slightly outpaced the broader market after figures showed on Friday that German year-on-year retail sales grew at their strongest rate in April since June 2012 as Easter fell later this year than last. In the European bond market, benchmark Bunds were slightly lower, tracking Treasuries US10YT=RR . Ten-year U.S. debt yielded 2.477 percent, up from the U.S. close of 2.447 percent but still close to its lowest levels since last June, touched this week as markets increased bets that the Federal Reserve will not begin raising interest rates any time soon. The euro was steady at $1.3605 EUR= , not far from Thursday's three-month low of $1.3586. The dollar index, which tracks the currency against a basket of six major rivals, eased slightly to 80.462 .DXY .

LONDON, May 30 (Reuters) - Sterling recovered some ground on Friday after a week of heavy selling that has cast doubt on the UK currency's run to 5-1/2 year highs. The pound has risen more than 10 percent against a basket of currencies in the past 12 months on the back of expectations that an improving economy would force the Bank of England to raise interest rates faster than its euro zone and U.S. peers. Figures this week, however, showed Britain's housing market may be cooling, prompting some aggressive bets on the timing of the first rate hike to be scaled back and putting the currency on track for its biggest weekly fall in more than two months. Dealers say sales of the pound have also been driven by the collapse, at least for the moment, of Pfizer's PFE.N attempt to buy AstraZeneca AZN.L for nearly 70 billion pounds ($118 billion). "One thing that seems fairly clear is that any of that M&A-related flow against the pound has cooled off today," said a dealer with one London bank. "Where we go from here will depend a lot on next week's action at the ECB and then non-farm payrolls in the U.S." The pound rose just over 0.1 percent to $1.6740 and by slightly less against the euro to 81.31 pence EURGBP= . Gilt markets have also been showing signs of doubt over the broad-based nature of Britain's economic recovery, still producing little of the broader-based price pressures which would raise inflation and force the BoE to act. The yield premium paid by British government bonds over German Bunds hit its lowest in three weeks on Thursday in response. GB2YT=RR DE2YT=RR Yields rose in tandem with Bunds and U.S. Treasuries on Friday, after Federal Reserve policymaker Esther George said the Fed's eventual rate rises should be steeper than many in the market expected. ID:nL6N0OG25C The 10-year yield GB10YT=RR was last up 1.8 basis points at 2.566 percent.

EUR/GBP 0.81321 closed @ 0.81289 for +3.2. No point holding over the weekend..

June 3 (Reuters) - Sterling held steady against the dollar and fell against the euro on Tuesday, absorbing surprisingly soft UK construction data but squeezed after weak euro zone inflation triggered a bounce in the shared currency. In late trade in London the euro was up 0.3 percent on the day at 81.40 pence EURGBP= and the pound was unchanged on the day against the dollar at $1.6745 GBP= . Inflation across the 18-nation euro zone slipped to just 0.5 percent in May, increasing the likelihood of easing measures from the European Central Bank later this week and highlighting the contrast with the Bank of England, which is expected to start raising interest rates within a year. ID:nL6N0OK1ES But although below consensus, the decline wasn't a major shock after German inflation figures on Monday came in well below analysts' forecasts. Relieved that inflation wasn't even lower, traders bought the euro back and sterling suffered. "There wasn't any additional 'fear factor' introduced and there was no real surprise, given the German numbers yesterday," said Daragh Maher, senior FX strategist at HSBC in London. "The market was running short of euros, so we have squeezed higher. Also, there's a lot already in the price for sterling in terms of interest rate hike expectations," he said. Financial markets expect the BoE to begin raising rates some time in the early months of next year, in stark contrast to the ECB which will still be in easing mode, and probably at least a few months ahead of the U.S. Federal Reserve. But nascent signs of the UK housing market cooling off have tempered some of the more aggressive bets on the timing of the first rate hike, the latest being a survey on Tuesday showing that the construction sector grew in May at its slowest pace in seven months. The Markit/CIPS UK Construction Purchasing Managers' Index (PMI) eased to 60.0 last month, below the 60.8 expected in a Reuters poll but still far above the 50 line that divides growth from contraction. ID:nL9N0MI020 Sterling had run up to a 5-1/2 year peak against the dollar earlier in May. Over the last year the pound has appreciated some 10 percent against a basket of currencies on the growing assumption that the improving economy and red-hot housing market will force the BoE to raise rates faster than its major peers. "The Bank will be tightening when the ECB is loosening ... but there's a somewhat dovish adjustment of UK rate expectations underway recently," HSBC's Maher said.

LONDON, June 4 (Reuters) - Sterling hit a new high for the day against the euro and pared losses against a buoyant dollar on Wednesday after UK services sector activity expanded at a faster than expected pace in May. ID:nL9N0O202G The pound climbed to $1.6730 GBP=D4 after the data from around $1.6705 beforehand, but was still down 0.15 percent on the day. The euro lost ground, hitting a low of 81.355 pence EURGBP=D4 after the survey was released, from around 81.48 pence beforehand. Financial markets expect the Bank of England to begin raising rates early next year, in stark contrast to the European Central Bank which will still be in easing mode, and probably at least a few months ahead of the U.S. Federal Reserve.