*Good morning/afternoon everyone!* The U.S. dollar is trading lower against most of the major currencies this morning as risk appetite improves after yesterday’s brutal selling. Stock futures are up, helping to bolster pairs like EUR/USD and USD/JPY. However as we begin the NY session, the decline in Treasury yields could also tip the scale and push USD/JPY lower. Yen crosses on the other hand will take their cue from stocks today. The currency most vulnerable to weakness is the Canadian dollar because oil prices are down more than 2% after President Trump tweeted that he hopes Saudi Arabia and OPEC will not cut oil production because he thinks oil prices should be much lower based on supply. Despite a softer Eurozone ZEW survey, EUR/USD is trading above 1.1250 on the hope that progress could be made on the Italian budget front. the expectations component of the ZEW surely also increased. The best performing currency this morning is sterling which is up on higher wages (despite a higher unemployment rate) and continued Brexit optimism. On the Brexit front, we are getting closer to a deal but with some counterproductive headlines, traders are still reluctant to overload sterling positions but when an announcement is made, we can almost be assured that there will be a strong followup rally. AUD and NZD are also up from yesterday but having risen strongly in Asian trade, they are mostly consolidating and even weakening slightly. We also have our eyes on the Swiss Franc which appears to be topping below 1.0130. *The MAIN THEMES I see today are* +EUR +CHF -CAD -JPY *Trading Biases* +EUR, +CHF, +GBP, -CAD, -JPY mildly +AUD, +NZD, -USD *Today’s Initial Trades* Here’s the summary – 1. Buy EURCAD at 1.4885, Stop at 1.4857, Target 1.4912 2. Buy EURUSD at 1.1247, Stop at 1.1219, Target 1.1275 3. Buy AUDCAD at .9531, Stop at .9503, target .9559 4. Sell AUDCHF at .7270, Stop at .7298, Target .7242

Swing

*Good morning/afternoon everyone!*

The U.S. dollar is trading lower against most of the major currencies this morning as risk appetite improves after yesterday’s brutal selling. Stock futures are up, helping to bolster pairs like EUR/USD and USD/JPY. However as we begin the NY session, the decline in Treasury yields could also tip the scale and push USD/JPY lower. Yen crosses on the other hand will take their cue from stocks today. The currency most vulnerable to weakness is the Canadian dollar because oil prices are down more than 2% after President Trump tweeted that he hopes Saudi Arabia and OPEC will not cut oil production because he thinks oil prices should be much lower based on supply. Despite a softer Eurozone ZEW survey, EUR/USD is trading above 1.1250 on the hope that progress could be made on the Italian budget front. the expectations component of the ZEW surely also increased. The best performing currency this morning is sterling which is up on higher wages (despite a higher unemployment rate) and continued Brexit optimism. On the Brexit front, we are getting closer to a deal but with some counterproductive headlines, traders are still reluctant to overload sterling positions but when an announcement is made, we can almost be assured that there will be a strong followup rally. AUD and NZD are also up from yesterday but having risen strongly in Asian trade, they are mostly consolidating and even weakening slightly. We also have our eyes on the Swiss Franc which appears to be topping below 1.0130.

*The MAIN THEMES I see today are*

+EUR
+CHF
-CAD
-JPY

*Trading Biases*

+EUR, +CHF, +GBP,
-CAD, -JPY
mildly +AUD, +NZD, -USD

*Today’s Initial Trades*

Here’s the summary --

1. Buy EURCAD at 1.4885, Stop at 1.4857, Target 1.4912
2. Buy EURUSD at 1.1247, Stop at 1.1219, Target 1.1275
3. Buy AUDCAD at .9531, Stop at .9503, target .9559
4. Sell AUDCHF at .7270, Stop at .7298, Target .7242

Will ECB Drive EUR to 1.25?

Will ECB Drive EUR to 1.25?

Chart Of The Day

Will ECB Drive EUR to 1.25?

After rising for 4 straight days, EUR/USD pared its gains ahead of Thursday’s European Central Bank monetary policy announcement. The ECB is widely expected to leave monetary policy unchanged but among all of this week’s rate decisions, theirs should be the most market moving. Policymakers have been very clear that sometime this year, their guidance will change and the only question is how quickly they will start talking about unwinding Quantitative Easing and raising interest rates. Although data has taken a turn for the worse since the last meeting, it is important to realize that many of these indicators are slowing from multi-month or year highs, which means they are retreating from very strong levels. The Eurozone economy is still performing well, stocks are off their highs, Italy’s election may have led to a political stalemate but in Germany, Angela Merkel has won the right to form a coalition government with the Social Democrats, ending months of political uncertainty. The euro is strong but it hasn’t appreciated further than its end of January levels. When the ECB last met, President Draghi acknowledged the euro’s rise by warning that euro volatility creates uncertainty but then spent the majority of his press conference talking about the solid and broad based momentum in the economy and the prospect of higher growth surprises that could lift core inflation over the medium term. We don’t expect these views to change at this week’s meeting and given the market’s desire to sell U.S. dollars, ECB optimism could be drive EUR/USD back to 1.25. Yet if Draghi suddenly sounds more cautious, we could see a nasty reversal in EUR/USD as speculators are clearly leaning towards optimism

Today’s Trades 06.09.2017- EUR, JPY

Swing

*Good morning/afternoon everyone!*

Hope you all got some sleep because it was a very exciting night in the FX market. GBP dropped as low as 1.2636 but finds itself above 1.2750 at the start of the NY trading session. What happened? Prime Minister May’s party did not secure enough seats to maintain a strong majority and its looking like there could be a hung Parliament, leading to speculation of her resignation. Describing last night’s vote as a setback for May is a terrible understatement but GBP is NOT trading near its lows because she has negotiated to stay as PM for the time being. I posted a chart of how GBP/USD traded after the 2010 Election where there was also a hung Parliament and we can certainly see some parallels. GBP/USD recovered for 2 days before melting lower after a coalition government was formed. I would be careful of selling GBP/USD today as whatever move the pair has should continue on Monday but its a weekend so a deal could be announced so better to wait until Sunday open.

The euro remain under pressure after the ECB meeting and appears to be aiming for 1.1150. USD/JPY continues to rebound as yields rise but there’s a lot of resistance between 110.35 and 110.50. Commodity currencies ex CAD should be quiet as the upward momentum subsides

We have CAD labor data at 8:30 NY / 12:30 GMT. If its weak we should see 1.36

*The MAIN THEMES I see today are*

GBP volatility
EUR weakness
USDJPY resistance
USDCHF strength

watch CAD after data

*Trading Biases*
These will change after US data

-EUR, -CHF
-USDJPY
neutral AUD, NZD

slightly bearish GBP
CAD -- have to see data

*Today’s Potential Ideas*

I like

Sell USDJPY at market (now 110.37), with a stop at 110.62, Target 110.07 (tightened stop -- it either fails here or doesnt)
Sell EURUSD at market at 1.1175, stop at 1.1225, Target 1.1145

Today’s Trading Plan 06.08.2017 – USDJPY and AUDJPY (EUR only after ECB)

Swing

*Good morning/afternoon everyone!*

European currencies are in focus this morning with the ECB meeting at 11:45AM and the UK vote throughout the day. The first results will be released around 21 GMT with the election likely to be called around 00:00 -- 1:00 GMT. EUR is trading with a heavy bias ahead of the rate decision against 1.13 as investors worry that Draghi will not be hawkish enough which means a lower inflation forecast and a risk assessment that cites downside risks.

Sterling is rising and falling on the polls. We expect some good 2 way action in pound before the polls close this afternoon. We have a full day before that happens so strap in for a wild ride before and after the election. The recovery in yields has taken USD/JPY above 110 on the confidence that Comey’s testimony won’t be damaging to Trump. We think gains are capped at 110.50 and see 110.40-110.50 as a good place to reestablish short positions.

USD/CAD looks like its finding resistance at 1.35 and could drift back down to 1.3440. AUD is weighed down by last night’s weaker trade report while NZD continues to fly high.

*The MAIN THEMES I see today are*

USD strength vs. JPY and CHF
NZD strength
CAD strength

AUD underperformance vs. NZD
EUR -- theme will emerge after ECB

*Trading Biases*
These will change after US data

+NZD, +CAD, +USD
-JPY
slightly +AUD

have to wait post ECB to trade EUR
marginally +GBP

*Today’s Potential Ideas*

**No view on EUR trades pre-ECB, no view on GBP trades

I like

+USDJPY at 110.05 with a stop at 109.75 aiming for 110.40
+NZDJPY at 79.25, with a stop at 78.75, Target 79.55

EUR – Headed for 1.05

EUR – Headed for 1.05

Chart Of The Day

EUR – Headed for 1.05

The main focus next week will be on the French Presidential election and the euro. Incoming polls will have a direct impact on how the euro trades and will overshadow the April PMI reports, which are normally the most important pieces of data released from the Eurozone each month. Even after Friday’s disappointing U.S. economic reports, the euro ended the day lower versus the U.S. dollar. We expect the currency to trade with a heavy bias going into the election as the recent terrorist attacks boost the popularity of far right leader Marine Le Pen. The polls have been tightening ahead of the first round vote. She is expected to do well but fall behind in the second round. If Le Pen gains more votes than Macron, the EUR/USD will make a run for 1.05. Even if she has fewer votes but strong support, investors will immediately worry about a Trump style victory by a candidate who is anti-immigration and has called for a EU referendum within 6 months of her victory. While the latest German ZEW survey showed an uptick in investor confidence, if taken today we believe sentiment will be weaker. The path of least resistance for the euro should be lower next week ahead of the French election with the single currency underperforming most of its peers.

Technically, the EUR/USD is very weak, having traded below the 100-day SMA. It is still holding below trendline support but we think that support will give, paving the way for EUR/USD to fall to 1.05. In order to negate the downtrend, the currency pair needs to bounce back above 1.07.

EUR – Bottom or Consolidation?

EUR – Bottom or Consolidation?

Chart Of The Day

EURUSD found a bid in late New York trade today rising well above the 1.0600 level as the pair continued to find support at the 1.0550 zone. The EUR/USD has now held that ground for more than two weeks but the next 72 hours could prove to be challenging to the pair as it faces two keys tests.

Of course tomorrow the market will be glued to US Non-Farm Payrolls report and if it is as good as we think it will be the euro should sell off strongly in the wake of good US job gains. The market will only become more convinced that the Fed rate hike cycle is now upon us.

Yet even if the NFP prove to be a snoozer, the Italian referendum over the weekend could prove to be the death knell of the single currency. We think than In the near term, the Italian referendum on Senate reform scheduled for December 4th poses the greatest near term risk for EUR/USD. No polls are permitted 15 days ahead of the vote and the last survey showed the No vote firmly ahead. The referendum is aimed at streamlining Italy’s government decisions by reducing the role of the Senate and regional governments. But is now seen as just another policy prescription rammed down the throat of populace by the “elite”. Prime Minister Renzi pledged to quit if the vote is rejected which would create another political crisis in Italy especially as the vote has been viewed as a referendum on EU membership. Italy’s political uncertainty should deter investors from buying euros, because this is no Greece. It’s the third-largest economy in the Eurozone and that means wrenching body blow to the whole EU project.

A break of 1.0550 would be critical for the pair as it would suggest that it could dip below the key 1.0500 support and open the way for ultimate move towards parity.

BK Big Trades 01.25.2016 2 New Orders for EUR and AUD

Swing

BK Big Trades -- 2 New Orders

1. EUR/USD

Aggressive

Place Order to Sell EUR/USD at 1.0865

Stop 1.1065

Conservative

Place Order to Sell EUR/USD at 1.0920

Stop 1.1120

2. AUD/USD


Aggressive

Place Order to Sell AUD/USD at 0.7010

Stop 0.7210

Conservative

Place Order to Sell EUR/USD at 0.7100

Stop 0.7300

It is a new trading week and we are ready to lay out some fresh Forex Big Trade orders. Nearly all of the major currencies are in play this week with AU CPI, FOMC, RBNZ, BoJ and UK GDP on the calendar. This morning’s German IFO report was also worse than expected reinforcing ECB President Draghi’s warning that more easing could be on its way in March.

We are laying out 2 sets of orders this morning -- on the back of the IFO and ahead of AU CPI. We are also actively watching USD/JPY and USD/CAD -- 2 pairs that we want to sell higher.

We still have the following pending order:

3. NZD/USD

Conservative

Order to Sell NZD/USD at 0.6560

Stop at 0.6760

EUR- Going for  a Squeeze

EUR- Going for a Squeeze

2009 eurusd forecasts Chart Of The Day

Everyone thinks that EUR/USD is going to parity -- and it may well end up there eventually-but in the meantime -- it may hurt a lot of complacent shorts as it starts to squeeze through the 1.1000 level. There are a couple of reasons for why the euro may start to appreciate.

1. Greece -- while the problem is hardly solved. It’s been shelved taking the downside pressure away.
2. Lower Oil -- is very stimulative for the EZ economy where energy costs are higher than the US. That along with easy credit from ECB should help EZ economy grow
3. Delay of rate hike to December -- although US labor continues to be impressive the Fed does not appear to be in a rush to hike and the longer it delays the stronger the euro gets.

Tomorrow’s Flash EZ PMI data could give us a clue as to the conditions on the ground and if the data continues to print above the 50 boom/bust line it could send the euro towards the 1.1100 level.