EURUSD reached new high yesterday so we assume that wave 4 is already complete and that wave 5 is underway which has room for further gains, towards 1.3500 in sessions ahead. Meanwhile 1.3318 support must hold, otherwise we would assume that top is in place. From a larger perspective we need to keep in mind that wave 4 was a triangle and that triangle always occur prior to the final move of the larger pattern, which means that current leg up will sooner or later complete a bullish…Continue
Added by Gregor Horvat on June 19, 2013 at 7:51am — No Comments
UBS - "USDJPY remains the focus of the currency markets. Over the last two weeks the flush out of positions in the currency pair and the Nikkei has been savage, causing investors to unwind other dollar longs against the euro, pound and Swiss franc. In contrast, the fundamentals supporting a stronger dollar this year remain intact.
(...) most of the forty clients we met this week in France, Sweden and Switzerland also still favour the dollar this year. Longs have clearly been strongly…
UBS - "In the week ahead, UBS Economics forecasts stronger than expected US ISM and payrolls releases. That is set to make investors more fearful of carry trades being unwound. As a result the dollar is likely to continue rallying against emerging market and commodity currencies, rebound against the euro and pound, and should start to recover lost ground against the Swiss franc and yen. This week's key points for currencies are:
- firm US data to pressure risk trades, favour…Continue
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In this environment opening and closing positions quickly is a popular method which is known in extreme cases…Continue
UBS - "Despite the volatile moves suffered by financial markets particularly the Nikkei, we think the key trend in currency markets of a rising dollar remains intact.
(...) For now the focus of the currency markets will remain on Japan. Bank of Japan Governor Kuroda will speak on Sunday and again on Wednesday. In addition the central bank will meet investors also on Wednesday to discuss the Japanese bond and equity markets. If Kuroda and his officials succeed in lowering volatilty in…
Added by Francesc Riverola on May 26, 2013 at 8:00am — No Comments
UBS - "The dollar remains our favoured currency for 2013. The US economy is likely to expand more than its peers. The Federal Reserve is set to exit uncoventional monetary policy before other major central banks. Dollar diversification by central bank reserve managers and sovereign wealth funds is subdued, and America's shale energy revolution is cutting its current account deficit. Our bullish view on the greenback has become more consensus now. But if the dollar does embark on a multi-year…Continue
Added by Francesc Riverola on May 20, 2013 at 5:28pm — No Comments
Brown Brothers and Harriman - "The dramatic sell-off of the Australian dollar is the latest of a series of price developments that have surprised the market. (...) The Australian dollar was the market's darling. It was an accessible even if not perfect way to get exposure to China and its vociferous demand for commodities. It was one of the few triple-A rated countries left standing after the financial crisis. Its interest rates were relatively higher in an environment in which there was a…Continue
Added by Francesc Riverola on May 16, 2013 at 1:55pm — No Comments
Rabobank - "We have been arguing over the past month that while the yen should remain on a weakening trend that the upside potential of USD/JPY would be slowed if the market was paring back the size of its USD positions. This view seems to have been upheld in April though yesterday’s break of the psychologically important USD/JPY100 levels has injected fresh life into the currency pair. Over the coming weeks we continue to expect that the tone of the USD will be key in determining the pace…Continue
Added by Francesc Riverola on May 10, 2013 at 2:55pm — No Comments
UBS - "The overnight break above the psychological 100 level is likely to pave the way for further upside too. The break was accompanied by broad-based dollar strength which chimes with our more general stronger dollar view for 2013.
With events unfolding in favour of further yen weakness, we take this opportunity to raise our 1m and 3m USDJPY forecasts to 102 and 105 respectively (previously both stood at 95.00). Our end-2013 forecast remains at 110.
(...) The dollar has chalked up…
Added by Francesc Riverola on May 10, 2013 at 7:08am — No Comments
Brown Brothers Harriman -
"- Sweden's Riksbank kept rates steady at 1.0%, as expected
- Bank of England minutes from the April meeting show that the vote for extending QE remained the same as the March meeting
- Bank of Canada holds its policy meeting today and is expected to keep rates steady at 1.0%
- The Fed releases the Beige book report for the upcoming April 30/May 1 meeting
- There is keen interest in how Japanese investors are going to respond to…Continue
Added by Francesc Riverola on April 17, 2013 at 2:17pm — No Comments
It has been a while since gold has lost over $50.00 in a week. But it has this week.
The outlook is deteriorating, as the market heads to the base of its range for the past twenty months at 1522. Not far below here, the major foundation for the bull run since 2002, comes in at 1491. This level is pivotal, it marks the 110 week moving average. A safety rope that…Continue
There is a big bear sitting on the euro. Is it Russia!
No it’s everyone who is fed up of being told fairy stories about stability, unity, co-operation and solutions by European politicians, the ECB and the IMF.
Resolution by policy ineptitude can only bore the market into a…Continue
UBS - "This year the dollar is leading the other major currencies. But on a broad trade-weighted basis, including emerging market and commodity currencies, the greenback remains close to its all-time lows.
Dollar bulls - looking for a multi-year greenback rally like those of 1978-1985 and 1995-2002 - are anticipating the Federal Reserve will start scaling back its quantitative easing this year. That appears the most likely trigger for a broader dollar recovery in 2013.
But for a big…
Added by Francesc Riverola on March 22, 2013 at 8:42am — No Comments
Goldman Sachs - "FX markets remain dominated by offsetting policy forces, which we described as a non-cooperative Global Exchange rate Mechanism (...) Within such a regime, much of the market focus has to be on the risk of ‘realignments’, or policy shifts, which have the potential to move a currency to a new level. Such a shift has happened in the Yen already. Our view is that the risks from current levels are broadly balanced, and this is reflected in our new forecasts, centred around $/JPY…Continue
Added by Francesc Riverola on March 18, 2013 at 10:25am — No Comments
UBS - "This week's key points for currencies are:
- upcoming FOMC forecast round key for dollar strength
- ECB inaction to support euro on the crosses
- the new BoJ won't disppoint USDJPY bulls
- MPC waits for Budget BoE review, stay short Cable
- SNB to stay on hold in the week ahead, watch USDCHF
- Norges Bank also to remain unchanged next week
- Australian jobs, RBNZ meeting should temper AUDNZD rally"
Mansoor Mohi-uddin, Managing Director &…
Added by Francesc Riverola on March 9, 2013 at 10:53am — No Comments
ING Bank - "February has presented an unambiguously good US nonfarm payrolls report, with both the non-farm payrolls and unemployment rate pushing in very encouraging directions. Non-farm payrolls rose 236K, up from 119K, which was part of a 15K net downward revision to the previous month’s data.
(...) The near term market reaction will be to sell the back end of the yield curve, and for equities and the dollar to rally (especially against the JPY and GBP). With the Fed committed to…
Added by Francesc Riverola on March 8, 2013 at 2:13pm — No Comments
I ran across this today and thought it was interesting. The World Bank is forecasting a softening in both gold and oil prices over the next ten years. If gold does decline it "might" mean a stronger dollar. The negative correlation between the two doesn't always hold true but it's something to consider when looking at the bigger picture.
So what might drive gold lower? The first guess would be inflation and an increase in interest rates. Rates here in the US have been low for a…Continue
UBS - "The pound, like the yen recently, is undergoing a sharp devaluation against the other major currencies. Late on Friday, Moody's stripped the UK of its AAA rating citing continued weakness in Britain's medium term growth outlook. We remain bearish sterling and expect Cable to trade in a lower 1.40-1.50 range over the next couple of months.
Financial markets are set for a challenging week. (...) This week's key points for currencies are:
- Bernanke to be dovish but Fed hawks…
Added by Francesc Riverola on February 24, 2013 at 9:22am — No Comments
UBS - "Sterling is likely to be the next major currency that depreciates strongly. This follows the plunge of the yen over the last few months. As central banks tolerate higher levels of inflation, the pound is set to weaken further across the board particularly against our favourite G4 currency, the US dollar. This week's key points are:
- watch FOMC minutes for signs of Fed easing fatigue
- Italian elections key for euro in the week ahead
- forget G20, Abe's BoJ choice to…
Added by Francesc Riverola on February 16, 2013 at 12:03pm — No Comments
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Added by Greenwhale on January 18, 2013 at 11:17am — No Comments