JAPAN: Koizumi & Takaichi Play It Safe On Foreign Policy In LDP Debate
Sep-24 11:10
Earlier, the five contenders for the presidency of the governing Liberal Democratic Party (LDP) participated in a debate hosted by the Japan National Press Club. Asahi Shimbun detailed the main points of the debate, with key foreign policy comments from the main contenders, Agriculture, Forestry and Fisheries Minister Shinjiro Koizumi and former Minister of State for Economic Security Sanae Takaichi, below.
- Koizumi:
- On US-Japan relations: "Building trust between leaders is extremely important." He indicated a desire to meet Trump at the earliest possible time if elected PM. He said that "Japan-US relations remain the cornerstone of Japan's diplomacy."
- To former Minister of State for Economic Security Takayuki Kobayashi, Koizumi says that 2% of GDP on defence is "not nearly enough."
- Takaichi:
- On foreign relations: "I believe it is extremely important to cooperate and respond [with South Korea] amid the growing closeness between China, Russia, and North Korea. While there is economic competition to some degree, there is significant cultural exchange." Calls for deeper Japan-US-RoK links, as well as Japan-US-Philippines.
- On relations with China: "While there are concerns regarding economic security and national defence, diplomatic strength is crucial. We will approach this with a stance of engaging in candid and repeated dialogue."
- Takaichi demurred on the topic of visiting the controversial Yasukuni shrine. Advocating for the PM visiting during the 2024 LDP election, this time she said the issue should not be politicised in effort to maintain ties w/RoK if she becomes PM.
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OUTLOOK: Price Signal Summary - Bear Threat In Oil Futures Still Present
Aug-25 10:56
- On the commodity front, the medium-term trend condition in Gold remains bullish - moving average studies are in a bull-mode position highlighting a dominant uptrend. The sideways direction that has been in place since the Apr peak appears to be a pause in the uptrend. A resumption of gains would open $3439.0, the Aug 23 high. On the downside, first key support to watch lies at $3268.2, the Jul 30 low. First support is $3311.6, the Aug 20 low.
- In the oil space, a bear cycle in WTI futures remains intact and recent short-term gains appear corrective - for now. A key support at $61.99, the Jun 30 low, has been breached, strengthening a bearish theme. A continuation lower would open $57.71, the May 30 low. Key short-term resistance has been defined at $69.36, the Jul 30 high. Clearance of this level would cancel a bear theme.
OUTLOOK: Price Signal Summary - EURUSD Trend Structure Remains Bullish
Aug-25 10:47
- In FX, the trend set-up in EURUSD remains bullish and Friday’s rally reinforces current conditions. Support at the 50-day EMA remains intact, at 1.1596. A clear break of it would signal scope for a deeper retracement and potentially expose key support at 1.1392, the Aug 1 low. For bulls, a stronger resumption of gains would open key resistance and the bull trigger at 1.1829, the Jul 1 high.
- Strong gains on Friday in GBPUSD signals the end of the recent corrective phase - Friday’s reversal pattern is a bullish engulfing candle. An extension higher would refocus attention on the short-term bull trigger at 1.3595, the Aug 14 high. Clearance of this level would signal scope for a climb towards 1.3636, 76.4% of the bear leg between Jul 1 and Aug 1. Key short-term support has been defined at 1.3391, the Aug 22 low.
- USDJPY traded sharply lower Friday highlighting a potential bearish threat. The bear trigger has been defined at 146.21, the Aug 14 low. Clearance of this level would reinstate a downtrend and pave the way for an extension towards 145.40, the 50% retracement of the Apr - Aug upleg. For bulls, a resumption of gains would instead open 149.12, 61.8% of the Aug 1 - 14 bear leg.
US TSY FUTURES: September'25-December'25 Roll Update - Massive Volume
Aug-25 10:37
Latest Tsy quarterly futures roll volumes from September'25 to December'25 below. Percentage complete jumped to over a third of outstanding Sep'25 open interest after Friday's massive volume. "First Notice" date next week Friday, August 29. Current roll details:
- TUU5/TUZ5 appr 91,400 from -8.75 to -8.5, -8.75 last; 41% complete
- FVU5/FVZ5 appr 69,500 from -5.25 to -5.0, -5.25 last; 39% complete
- TYU5/TYZ5 appr 198,500 from -1.25 to -1.0, -1.25 last; 38% complete
- UXYU5/UXYZ5 app 138,800 from -0.5 to +0.0, -0.5 last; 37% complete
- USU5/USZ5 appr 25,400 from 12.5 to 13.0, 12.75 last; 41% complete
- WNU5/WNZ5 appr 48,000 from 7.5 to 8.0, 7.75 last; 41% complete
- Reminder, Sep futures don't expire until next month: 10s, 30s and Ultras on September 22, 2s and 5s on September 30. Meanwhile, Sep'25 Tsy options will expire LAST Friday, August 22.
