Saturday, 11 June 2011

Special Relationships


The Australian Dollar and Japanese Yen (AUDJPY) versus the All Ordinaries (XAO - Australian Stock Index). Symbiotic since 2003.

Last 4 Years:


  • The AUDJPY will fall to meet XAO; or
  • XAO will rise to meet AUDJPY; or
  • A bit of both, falling AUDJPY and rising XAO until they mate.

If you wanted to short the Australian Stock Market in previous bear moves, the selling of AUDJPY (effectively buying Yen with the Aussie) was an easy way.

Beware long term that if the Fukushima catastrophe and cover up goes south (and Japan as an economic entity) so may the relationship.




  1. The Australian Stock Exchange Volume is tiny compared to the Foreign Exchange (FX) Market.
  2. Yesterday $4.1B worth of Stock Changed hands at the ASX.
  3. In 24 hours $300B worth of Australian Dollars were traded in FX  with approximately $60B being AUDJPY.
  4. AUDJPY market is a 15 TIMES BIGGER MARKET than Australian Stocks.

...just so you know who is the driver.

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