As much as Greece headlines seem to absolutely cluster all financial media, and bears humping the idea that Greece might be the trigger for absolute financial Armageddon, I would be quite skeptical of such, at least in the short term. I will refrain for now on writing any solidified opinions regarding a potential Grexit and its potential impacts. Below are some of the reasons to which why in my view, for today (before yet another weekend risk once more of the Greek Referendum) .
Risk is contained to European bond yields and equities
Although we have seen increased volatility in FX (especially in the EUR) post the large weekend gap, FX can be argued to be lacking definitive continuous price action in response to the developing Greek headlines. To me, this can be perceived as such risks being increasingly priced in by the market. If Greece truly was a risk, I believe despite the fact that it is NFP week, and that summer is closing in, negative sentiment should be translated to the price, regardless. The fact that this is not the case for now, means that markets are somewhat not being too flustered by Greece for now. This can be seen by the lack of sustained JPY and CHF buying. In the case of the CHF, the franc remains to maintain a steady correlation with the EUR, and a lack of a differentiated safe-haven bid into the CHF, doesnt' really scream "risk-off" - at least in the traditional sense. USDJPY suffered a weekend gap down as well, though have sufficiently recovered. The failure for other safe haven barometers such as gold to be bid, emphasizes the idea that the market is not too worried at the moment.
USD is continuously bid for now
Amongst major currencies, the dollar remains largely bid on the week, and I think in the case of USD/JPY specifically, players have taken advantage of the gap down as discounted entry prices to enter on the long-USD trade once more. And as such, with today's NFP, I am planning on entering longs around the event risk, on a spike down. In the case of the EUR, with a majority bearish parity forecast, I wouldn't be too heavily bearish. I very strongly remember the Euro bottoming near 1.2000 in 2012, right around when Barron's had a cover that it's going to hit parity. Now the whole magazine cover argument near tops/bottoms is for a whole different conversation altogether, but one can't help but be conscious of the funny ways the market tends to bottom/top near "armageddon world is over" themes. Aside from my not-so convinced of EUR bearishness view, I would be tempted to trade the EUR/JPY around the NFP as well, looking to fade either moves to 137.40-50 or support at 136.00 as I believe it would remain rangebound.
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