Top Market Movers: USDJPY, GBPJPY, EURJPY

USDJPY

China Speculation Rules Market

Following the G7 conference, dollar sellers ran wild in the market as bidders took to the Japanese yen on comments by global policy heads and some speculative confirmation from Chinese President Hu Jintao. Noted at the end of the weekend excursion, finance ministers teamed up against the Chinese regime calling for increased flexibility as the pegged currency helps to maintain the country's export edge.

Subsequently, President Hu Jintao stated that a slow incremental pace is what should be expected when considering evaluation. However, he also conceded to the need for increased efforts sparking mass speculation on a near term policy change. The Japanese yen benefited on the session, as a result, with traders proxy trading to the number one mover on the day. The price momentum took the underlying pair through the option position plays at 115.20 and the figure with plenty of capping ahead of the 114.80 option.

Firmly consolidating at the moment, further downside could ensue should the 114.80 support floor break. Ultimately, the news weighed heavily with the market casting aside the overnight data on Supermarket and Nationwide Department Store sales.

Rumorville

Should the 114.80 fail to hold, stops under 114.20 may exacerbate the flow lower. However, bidders look to return in protecting a manageable option related barrier ahead of the 114 figure. Offers look to comparatively contain the day's gains at 115.00 and 115.40.

GBPJPY

Cross Selling On Major Demand

USDJPY shorting fed cross offers leading the wide GBPJPY currency cross lower over the course of the overnight in to the NY open. With a potential rate cut in the third quarter of the year expected by the Bank of England, attention looks to shift to a rising interest rate rather than a falling one. In this case, with China revaluation speculation heightened and Japanese economics improving, the market sided with broad yen bidding.

The selloff corresponded with a technical level as the currency pair was seen as being overextended for some time now. As a result, the market tossed aside economic data for the UK economy, which included overall retail sales figures for the month of March. Expected to fall lower, and spark notions of a rate cut, the survey rose much better than expected. Estimated to have risen by 0.3 percent in the month, consumption soared 0.7 percent. Attributed to the optimistic lift has been rising home valuations and a more founded sector as consumers look slightly less reluctant in the previous month. Subsequently, this may quell any concerns previously purported by central bankers which may heighten rate cut speculation.

Rumorville

With USDJPY offers being taken into the Asian session, pound offers continue to lend to notions of further GBPJPY selling pressure. Sellers look to enter above at 1.7930 with tightly above at 1.7940. Barriers continue to add pressure to the major sterling leg at the 1.7950 and 1.1800 figures.

EURJPY

Traders Toss Aside Uplifting Euro Data

In the day's fashion, traders cast aside improving Euro region economic data for mass speculation regarding Chinese yuan revaluation and G7 meeting statements. Nonetheless, figures still bode well for Euro upside, suggesting possible dollar weakness in the near future. Released in the morning the market saw improved confidence in the French economy as the indicator soared above the 105 print expected n the month of April.

Rising to a five year high, the report followed a German industrial report that gained for a third month and increases the likelihood that European Central Bank President Trichet will likely raise interest rates again at the next meeting in June. With continued inflation, traders are bidding up the three month Euro area futures contract to reflect the 3.25 percent decision by year's end. Subsequently heading into the Asian session, Asian and Middle East buyers look to emerge on dips with a test of topside resistance at 1.2415 looking possible.