The week has arrived – to taper or not to taper seems no longer a question.
The market is now poised for a mini one, USD 10-15bn, to be announced on the 18th.
As hoped for, the USD tapered last week, the question is how much, if more, to go.
Now is the time to pull out the most important chart – the USD Treasury yields have been increasingly closely more correlated with the USD yields this year.
The market (spec futures) is net short Treasuries most in 3 years,…Continue
Added by Ron Schelling on September 18, 2013 at 11:12am — No Comments
EUR/USD is showing almost no movement in Wednesday trading, as the markets gear up for the FOMC Statement later in the day. In the European session, the pair continues to trade in the mid-1.33 range. Looking at economic releases, there are no Eurozone releases on Wednesday. In the US, today’s highlight is Building Permits. The markets are not expecting much change in the August release.
Here is a quick…Continue
Added by Yohay Elam on September 18, 2013 at 10:55am — No Comments
BMO Capital Markets - "Best trade if the FOMC tapers:
I continue to hear FX market participants mention Fed taper as a key factor for positioning in EUR/USD and USD/JPY. However, my observation of correlations over the past few months is that neither of those pairs has been highly correlated with the Septaper theme. I view the 5-year tenor of US interest rates as the best one for gauging temper expectations. As shown in Chart 3, the currency pairs with the tightest…
Added by Francesc Riverola on September 18, 2013 at 9:16am — No Comments
HSBC - "1. No Tapering
G10: SELL USDJPY; SELL USDCHF. Safe havens such as the CHF and JPY would likely be favoured in this environment.
EM: Sell rallies in INR and IDR. EM FX may enjoy an announcement effect rally on this outcome. However, any rally would likely be short-lived as the Fed has only delayed the inevitable.
2. Just Tapering
G10: BUY GBPUSD, BUY NZDUSD. Continuation would likely be the market play on this largely consensus…
Added by Francesc Riverola on September 18, 2013 at 8:04am — No Comments
*** Intra-Daily Trading Strategy: SELL Euro Dollar / US Dollar
Sell Target: 1.3345
Sell Stop: 1.3364
Enter New SELL on OPEN and exit SELL positions at Target price or at Stop price.
(NOTE: Adjust Stop Loss Price according to your trading risk.)
Do not reverse after exiting. This is a recommendation for INTRA-DAY TRADING…Continue
Added by Martin Kay on September 18, 2013 at 8:03am — No Comments
Added by Jason Sen on September 18, 2013 at 7:51am — No Comments
Royal Bank of Scotland - "My base case it that the Fed kicks off with a 10bn taper, 5 each for Tsy and MBS; this firms up the full taper projection. Our economists are calling for a 20bn taper. But our Treasury trader pointed out that this is per quarter. It makes sense that the Fed begins to use its quarterly full forecast/press conference meetings to announce QE taper steps, rather than adjusting every meeting. This gives them decent increments to assess the economic growth outlook between…Continue
Added by Francesc Riverola on September 18, 2013 at 7:49am — No Comments
Added by Jason Sen on September 18, 2013 at 7:05am — No Comments
Added by Jason Sen on September 18, 2013 at 7:02am — No Comments
Immediate signals for sentiment are not entirely clear because this week's early action has seen consolidation rather than trend.
But the last 2 weeks have seen steady demand that has taken sterling to 8 month highs.
The top of weekly Ichimoku Cloud has been broken for the 1st time since January
Both momentum and strength indicators are positive
And prices are ‘hugging’ the top of a bullishly trending daily Keltner channel.
So the tone is clear…Continue
MTG MARKET UPDATE 18.09.13
Today the most important economic news is FOMC meeting at 11pm,a big movement is expected. The FOMC holds eight regularly scheduled meetings per year. At these meetings, the Committee reviews economic and financial conditions, determines the appropriate stance of monetary policy, and assesses the risks to its long-run goals of price stability and sustainable economic growth.
Added by Usman Ali on September 18, 2013 at 6:57am — No Comments
Added by Hedgeson on September 18, 2013 at 6:30am — No Comments
Added by Carol Harmer on September 18, 2013 at 5:59am — No Comments
Nothing interesting these days as the market is waiting for the FED decision to tap or not the QE today, so nothing interesting is going to happen until the american session. Yesterday's better than expected ZEW data didn't make the EUR to react too. Today a high volatility will present so place bigger stops or stay away from the market and leave the EUR to determine the direction. Once determined EUR will continue to move in the same direction for the next several days. So you will have…Continue
Added by muthusamy perisamy on September 18, 2013 at 3:00am — No Comments
Added by muthusamy perisamy on September 18, 2013 at 2:59am — No Comments
FOMC to begin tapering and start with more or less USD 11-16 bn. Around USD 5bn would most likely be considered dovish, but the muscle of USD20bn would push bonds higher than the 5bn to push them down. Why? Easy: post-Summers expectations of ongoing FED dovishness.
A dovish taper accompanied by more aggressive forward guidance could, at least at first, weigh on the dollar against the sterling $USDGPB if it erodes the currency's rate advantage.
In other words, it remains to be…Continue
Currently we are at 0.9354 after bouncing on the trend. We are looking for a bullish continuation to the Day chart DOWN trend line area @ 0.9403. Watch for profit taking there. The average daily true range (ATR) for the pair currently is 91 pips.…Continue
Added by Scott Barkley on September 17, 2013 at 1:14pm — No Comments
The Indian rupee has recovered strongly in the last few weeks which has coincided with the arrival of the new governor of the Reserve Bank of India, Dr. Raghuram Rajan (who started his new job on 4th September 2013) and he has been credited with the 8 per cent rally in the Indian currency against the US dollar.
At the end of August, the Indian rupee was perilously close to the 70 level against the US dollar and every one and his dog was saying how bad the Indian…Continue
Added by Ronnie Chopra on September 17, 2013 at 10:39am — No Comments