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- USDJPY volatility returns to "pre-Abenomics" levels
- Pair rises to 115.50 before falling back to 114.05
- Koefoed sees "fairly subdued" ECB meeting with Draghi urging caution
- Alibaba's share price continues to rise ahead of Single's Day
- Garnry issues warning on Amazon
By Martin O'Rourke
USDJPY is clearly where it is at today with volatility at "pre-Abenomics levels from a year ago", says FX desk's Jeppe Norup, leading to wild swings in the pair.
USDJPY hit 115.50 before the brakes were applied with a vengeance to force the pair back down to 114.05. "Everyone has been expecting this to trade higher," says FX desk's Pierre Magnussen speaking live from the floor in Copenhagen. "There is a support level at 112.40 and a line in the sand at 110."
"It is a major reversal in USDJPY," says Christoffer Moltke-Leth from Saxo's Singapore desk.
Today's European Central Bank is unlikely to offer anything new, says Saxo's head of macro strategy Mads Koefoed. "Mario Draghi will urge caution and patience," says Koefoed, adding quantitative easing might once again enter the forum during the press conference but that he "does not expect any details."
It is heating up in the equities markets especially as Alibaba continues to gather momentum with just five days to go to the biggest selling event of the year, China's Single's Day. The online giant's share price is stlll on the rise but Saxo Bank's head of equity strategy Peter Garnry fears it "is looking a little bit stretched."
If Garnry remains positive on Alibaba, albeit with caveats, it's a different story on Amazon. "Alibaba has changed the perception of Amazon and its business model," says Garnry "It is really building some negative momentum."
He also adds that while Tesla continues to perform, "it is looking stretched" but that Siemens and Kommerzbank are both developing positive momentum.
Militia have taken a key refinery in Libya taking potentially up to 300,000 barrels out of the market and giving oil prices some support. "Libya is a mess at the moment," says Saxo Bank's head of commodities strategy Ole Hansen, adding that Libya has been in part responsible for keeping oil prices low after supply was reinstated after the civil war.
Any return to civil war would automatically hit global supply.
A smaller-than-expected rise in US inventory and the onset of Winter demand are also boosting the price, he says.
Gold "continues to drift" says Hansen with resistance set at 1,160 USD/oz. "Physical demand from Asia is not picking up and there is a lack of Chinese buying."
Fleeing Libyan civilians raises the prospect of a return to civil war in the North African
state with ramifications for global oil supply and the oil price. Photo: Thinkstock
Follow Saxo Squawk live throughout the day. Sign up here to keep abreast of all developments throughout financial markets Martin O'Rourke is managing editor at TradingFloor.com, the online content platform for Social Trading leader Saxo Bank