Today’s Trades 04.25.2018 – EURUSD, USDCAD, EURGBP

Swing

*Good morning/afternoon everyone!*

The U.S. dollar higher across the board this morning as ten year Treasury yields trade above 3%. With no U.S. economic reports on the calendar, the dollar will take its cue from yields which are likely to volatile during the NY trading session as investors decide whether U.S. rates should stay above or below this key level. All of the major currencies are hit by the dollar strength but an ECB meeting on the calendar tomorrow leaved the euro is particularly vulnerable. With that in mind, the worst performing currencies this morning and the comm dollars which extended their losses on the back of falling commodity prices. Sterling and the Japanese Yen are the most resilient and that’s likely to remain the case as USD/JPY looks at a slow climb upwards. Stock futures are signaling a lower open that could add pressure on high beta currencies.

*The MAIN THEMES I see today are*

+USD
+JPY (but not vs USD)
-EUR
-CAD
-CHF

*Trading Biases*

+USD
-EUR, -CAD, -CHF,
mildly +GBP, +AUD, +JPY on relative basis
neutral NZD

*Today’s Initial Trades*

Here’s the summary --

1. Buy USDCAD at 1.2864, Stop at 1.2836, Target 1.2892
2. Sell EURUSD at 1.2202, Stop at 1.2230, Target 1.2174
3. Sell EURGBP at .8740, Stop at .8768, Target .8712

Close ALL open day trades by 10:20AM NY / 15:20 GMT

Today’s Trades 04.17.2018 – EURUSD, EURGBP, CADJPY, NZDCAD

Swing

*Good morning/afternoon everyone!*

Most of the major currencies are trading lower against the U.S. dollar this morning on the back of softer data. The EUR was hit by a lower ZEW survey, GBP fell on the back of weaker earnings, AUD and NZD are pressured by lower industrial production and quarterly GDP growth in China. The U.S. and Canadian dollars are the only ones unaffected so far and the greenback shouldn’t be significantly impacted by this morning’s housing and industrial production reports. Canada has manufacturing sales and the loonie is holding onto its gains ahead of Wednesday’s Bank of Canada monetary policy announcement. The weakest currency today is NZD followed by the Swiss Franc. With Dow futures pointing to a positive open and U.S. Treasury yields ticking slightly higher, today may be a day of pro rather than anti-risk that could see gains for USD/JPY.

*The MAIN THEMES I see today are*

-EUR
+CAD
-JPY
-GBP
+USD

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Buy CADJPY at 85.24, stop at 84.96, Target 85.52
2. Sell EURUSD at 1.2368, Stop at 1.2396, Target 1.2340
3. Buy EURGBP at .8638, stop at .8610, Target .8662
4. Sell NZDCAD at .9220, Stop at .9248, Target .9192

Close ALL open day trades by 10:20AM NY / 15:20 GMT

EURGBP Breaks Key Support

EURGBP Breaks Key Support

Chart Of The Day

After more than a year EURGBP broke below the key.8600 support level which more of an indication of market’s disappointment in the ECB policy than its an overall bullish call on cable. Recent data from the region has consistently hinted that economic growth may have peaked and as we noted today, “EZ IP contracted by -0.8% versus 0.1% eyed in further evidence that growth in the region may have peaked. This puts the ECB in a precarious position as the central bank prepares for a taper of QE just as economic conditions may have deteriorated. This is likely to prevent the ECB from considering any normalization process for the foreseeable future regardless of how much the hawks on the council press for it.”

This view was borne out by the dovish ECB minutes which suggested that the council intends to keep rates at zero for the foreseeable future even as it proceeds with the taper. All of this dovish news helped push EURGBP to its lowest level in more than a year, but whether the pair remains below .8700 will be contingent on UK politics and monetary policy. If anything UK economy is in worse shape the EU’s and any rate hike by the BoE could only exacerbate the slowdown. Combine that with the fact that Brexit negotiations are still stuck on the Irish border issue and the EURGBP break could well be a fakeout that traps eager shorts trying to ride the momentum.

Today’s Trades 04.11.2018 – EURGBP, USDJPY, GBPUSD, USDCAD

Swing

*Good morning/afternoon everyone!*

The U.S. dollar is trading lower against all of the major currencies this morning as investors wait for the next shoe to drop. With President Trump set to announce a response to the chemical attacks in Syria, ongoing trade tensions, the NAFTA meeting and the investigations in Russia / Trump’s lawyer, there’s significant headline risk today. U.S. CPI is expected to tip higher given stronger PPI and gas prices but the impact on the greenback may be limited. The FOMC minutes are also due later this afternoon. The best performing currencies this morning are the euro and Japanese Yen. Mario Draghi is speaking but so far there hasn’t been any significant headlines. We are also seeing some profit taking in the commodity currencies as European equities sell off and Dow futures point to a lower open. Global bond yields are down across the board which is adding pressure on USD, EUR and GBP.

*The MAIN THEMES I see today are*

-GBP
-CAD
+EUR
-JPY

*Trading Biases*

+EUR, +CHF
-GBP, -CAD, -JPY, -AUD
mildly -NZD, -USD (trend is down but data could prop the buck)

*Today’s Initial Trades*

Here’s the summary --

1. Buy EURGBP at .8720, stop at .8692, Target .8748
2. Buy USDCAD at 1.2612, Stop at 12584, Target 1.2640
3. Sell USDJPY at 106.90, Stop at 107.18, Target 106.62
4. Sell GBPUSD at 1.4189, Stop at 1.4217, Target 1.4161

Close ALL open day trades by 10:20AM NY / 15:20 GMT

*Good morning/afternoon everyone!*

The U.S. dollar is trading lower against all of the major currencies this morning as investors wait for the next shoe to drop. With President Trump set to announce a response to the chemical attacks in Syria, ongoing trade tensions, the NAFTA meeting and the investigations in Russia / Trump’s lawyer, there’s significant headline risk today. U.S. CPI is expected to tip higher given stronger PPI and gas prices but the impact on the greenback may be limited. The FOMC minutes are also due later this afternoon. The best performing currencies this morning are the euro and Japanese Yen. Mario Draghi is speaking but so far there hasn’t been any significant headlines. We are also seeing some profit taking in the commodity currencies as European equities sell off and Dow futures point to a lower open. Global bond yields are down across the board which is adding pressure on USD, EUR and GBP.

*The MAIN THEMES I see today are*

-GBP
-CAD
+EUR
-JPY

*Trading Biases*

+EUR, +CHF
-GBP, -CAD, -JPY, -AUD
mildly -NZD, -USD (trend is down but data could prop the buck)

*Today’s Initial Trades*

Here’s the summary --

1. Buy EURGBP at .8720, stop at .8692, Target .8748
2. Buy USDCAD at 1.2612, Stop at 12584, Target 1.2640
3. Sell USDJPY at 106.90, Stop at 107.18, Target 106.62
4. Sell GBPUSD at 1.4189, Stop at 1.4217, Target 1.4161

Close ALL open day trades by 10:20AM NY / 15:20 GMT

Today’s Trades 04.05.2018 – EURGBP, USDCAD, NZDCAD

Swing

*Good morning/afternoon everyone!*

The U.S. dollar is trading higher against all of the major currencies this morning thanks to yesterday’s strong reversal in U.S. stocks and overnight strength in Asian and European equities. For what its worth, Dow futures are pointing to a positive open with bond yields up across the board. This should be drive risk currencies higher but is supporting the greenback instead. Part of this has to do with softer UK and EZ PMIs, which have driven euro and sterling lower. USD/JPY made a run for 107 but with the 50-day SMA capping gains, we have not seen much continuation. The commodity currencies are weak but AUD and NZD are trying to come back while the Canadian dollar slips ahead of its trade balance report. There was a big upside surprise in last month’s release which has investors looking for softer numbers. From the U.S., weekly jobless claims and trade balance are scheduled for release but these reports tend to have only limited impact on the greenback.

*The MAIN THEMES I see today are*

+USD
-CAD
-EUR
-GBP

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Buy NZDCAD at .9311, Stop at .9283, Target .9340
2. Buy USDCAD at 1.2770, Stop at 1.2742, Target 1.2798
3. Buy EURGBP at .8732, Stop at .8704, Target .8760

Close ALL open day trades by 10:20AM NY / 15:20 GMT

EUR/GBP Could Drop to .8800

EUR/GBP Could Drop to .8800

Chart Of The Day

EUR/GBP Could Drop to .8800

One of the biggest stories this past week was European Central Bank President Mario Draghi’s post monetary policy meeting comments. They sent the euro tumbling against the U.S. dollar because Draghi was not nearly as optimistic as the changes in the policy statement suggests. The central bank head emphasized the need for policy accommodation, the downside risks related to global factors, the strong euro and protectionist threats. The ECB lowered their 2019 inflation forecast as Draghi warned that underlying inflation remains subdued, “victory hasn’t been declared” and therefore “ECB policy will continue to be reactive.” Taking all of this into consideration, the ECB is telling us that while they are more confident in the economy, they don’t plan to taper quickly. For this reason, we believe that euro will underperform other major currencies in the coming week and we expect further losses against sterling. There’s absolutely nothing on the UK calendar and data hasn’t been that terrible -- service sector activity accelerated and while the trade deficit expanded slightly, industrial production rebounded at the start of the year. If ris appetite improves we should see sterling outperform the euro.

Technically, we’ve seen 3 days of lower highs and lower lows in EUR/GBP. This move took the currency pair below the first standard deviation Bollinger Band. There’s a lot of support near .8845, but we believe that the sell-off could extend to .8800.

Today’s Trades 03.05.2018 – EURUSD, EURGBP, AUDCAD, AUDUSD

Swing

*Good morning/afternoon everyone!*

The U.S. dollar is trading higher against all of the major currencies this morning except the Japanese Yen, though USD/JPY has found support above 105.50. What’s interesting about this morning’s move is that its not necessarily driven by risk aversion as European stocks trade higher and Dow futures point to a only a modestly lower open. The markets are slightly nervous about the elections in Europe, encouraged by the stronger PMI data in the UK and eager to take USD/CAD to fresh 8 month highs. The Australian and New Zealand dollars are also under pressure but unlikely to see any big movements until U.S. stocks move significantly in one direction or another. This is a big week in the FX market with 4 central bank rate decisions on the calendar (RBA, BoJ, ECB, BoC) and the U.S. non-farm payrolls report. Today, the ISM non-manufacturing index will be released and its important because its a leading indicator for NFP. Trade wars are still on everyone’s minds but with no new antagonism from China and other foreign nations over the weekend , it has taken a backseat to Europe’s political developments.

*The MAIN THEMES I see today are*

+USD
-EUR
-CAD
-AUD

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Sell EURGBP at .8904, Stop at .8932, Target .8876
2. Sell EURUSD at 1.2299, Stop at 1.2327, Target 1.2271
3. Sell AUDUSD at .7746, Stop at .7774, Target .7718
4. Buy AUDCAD at 1.0010, Stop at .9982, Target 1.0038

Close ALL open day trades by 10:20AM NY / 15:20 GMT

EUR/GBP Rolling Over?

EUR/GBP Rolling Over?

Chart Of The Day

On a fundamental and technical basis, we believe that EUR/GBP could be headed for near term losses. This is an important week for the euro and the upcoming political / economic events will highlight the region’s vulnerability. Politically, German and Italian politics are in focus. The Social Democrats begin voting on Merkel’s coalition government on Tuesday. They have until March 2nd to file their votes and the outcome will be announced on March 3rd and if they reject the coalition, new elections are likely. In Italy, the Five Star Movement is gaining traction making investors nervous ahead of the Italian elections in 2 weeks. The outcome could have significant ramifications for the Eurozone. Economically, we are looking for softer EZ data starting with Tuesday’s German ZEW survey. It will be difficult for investors to remain optimistic after the nearly 9% drop in the DAX from its high on January 23rd. Sterling has key data on Wednesday but between now and then, we should see GBP outperform EUR after BoE Governor Carney avoided talking about policy.

Technically, EUR/GBP has fallen below the first standard deviation Bollinger Band, signaling potential for a deeper reversal. Although it bounced on Monday, the 100 and 200-day SMAs should cap gains. If we’re right, EUR/GBP could slip down to 88 cents and possibly even lower. Only a break of February high near .8820 negates the downtrend.

Today’s Trades 02.07.2018 – EURGBP, EURUSD, USDCAD

Swing

*Good morning/afternoon everyone!*

Risk sentiment is starting to deteriorate again after yesterday’s attempted consolidation. Asian and European equities came off their highs with some indices ending the day in negative territory. Dow futures are pointing to another ugly open. U.S. stocks may have experienced their strongest one day rise since 2016 but investors are nervous as the recent volatility makes them realize that equities are not in a one way uptrend. With U.S. yields rising the danger the economy faces is still very real. The Japanese Yen is the best performer today followed by the U.S. dollar -- the sell-off in USD/JPY is pulling other Yen crosses lower. All of the major currency pairs including EUR/USD and GBP/USD are vulnerable to additional losses at the start of the NY session. Yesterday’s recovery may have been a fakeout but prices could turn around just as quickly as they did yesterday so the prospect of volatile trading and wild swings means everyone should be weary of reversals.

*The MAIN THEMES I see today are*

-EUR
-GBP
+JPY
+USD (except USDJPY)
-CAD

*Trading Biases*

-EUR, -GBP, -AUD, -CHF, -CAD
+JPY, +USD (but -USDJPY)
mildly -NZD

*Today’s Initial Trades*

1. Buy USDCAD at 1.2519, Stop at 1.2491, Target 1.2547
2. Buy EURGBP at .8892, Stop at .8864, Target .8920
3. Short EURUSD at 1.2345, Stop at 1.2373, Target 1.2317

Close ALL open day trades by 10:20AM NY / 15:20 GMT

Today’s Trades 01.31.2018 – USDCHF, EURJPY, EURGBP

Swing

*Good morning/afternoon everyone!*

The U.S. dollar is trading lower against all of the major currencies this morning but thanks to President Trump who did not cause any major disruptions to the market, the sell-off is modest. High beta currencies continue to perform well with the New Zealand dollar leading the gains. There’s no specific explanation for the 1% jump outside of AUD/NZD selling after softer Australian CPI. Euro is trading above 1.2450 thanks to stronger German employment numbers and while GBP is also trading higher, it lags behind following a report that the EU rejected the city of London’s post Brexit deal for financial services. The Canadian dollar is trading firmly ahead of GDP but all eyes are on the FOMC today. It will be Yellen’s last and while the greenback is on its back foot, the currency’s slide should be limited by the prospect of a more hawkish outlook. Beware of month-end flows and the upcoming ADP and Chicago PMI reports.

*The MAIN THEMES I see today are*

+EUR
-JPY
-GBP

*Trading Biases*

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

*Today’s Initial Trades*

1. Buy USDCHF at .9330, Stop at .9302, Target .9358
2. Buy EURJPY 135.47 at 135.19, Target 135.75
3. Buy EURGBP at .8795, Stop at .8767, Target .8823

Close ALL open day trades by 10:20AM NY / 15:20 GMT

Today’s Trades 01.30.2018 – USDJPY, EURCAD, EURGBP, AUDJPY

Swing

*Good morning/afternoon everyone!*

If the price action in the FX market on Monday can be characterized by consolidation, the last 12 hours is best described by the word volatility. The dollar rallied hard during the Asian trading session into Europe but collapsed sharply after the London open. It is trading heavily as the NY session begins but trying to recover its losses as pairs like EUR/USD appear to be topping while USDJPY and USDCAD appear to be bottoming. There’s been zero fundamental catalyst but for the past few weeks its lived up to its title of Turnaround Tuesday. We’re also nearing the end of the month and after some very strong moves in currencies, portfolio rebalancing could be affecting FX trade. Eurozone data was mostly in line with expectations with the EZ economy expanding by 0.6% in Q4. UK mortgage data was slightly weaker. Consumer confidence and house prices are scheduled for release this morning but the main focus will be this evening’s State of the Union Address by President Trump -- traders may look to unwind positions ahead of this big event.

*The MAIN THEMES I see today are*

+GBP
+USD
-AUD
-CAD

*Trading Biases*

+USD, +GBP
-AUD, -CAD, -NZD
mildly +EUR, +JPY (+USDJPY)
neutral CHF

*Today’s Initial Trades*

1. Sell AUDJPY at 87.98, Stop at 88.26, Target 87.70
2. Sell EURGBP at .8803, Stop at .8831, Target .8875
3. Buy USDJPY at 108.64, Stop at 108.37, Target 108.92
4. Sell AUDJPY at 87.98, Stop at 88.26, Target 87.70

Close ALL open day trades by 10:20AM NY / 15:20 GMT

Today’s Trades 01.23.2018 – EURGbP, AUDJPY, NZDCHF, NZDUSD

Swing

*Good morning/afternoon everyone!*

All of the major currencies are trading lower this morning with AUD/USD leading the slide. We’re finally seeing weakness in a pair with very little retracements over the past month. Although USD/JPY is also down, the greenback is better bid against most of the major currencies including the euro, which should have benefitted from a stronger ZEW. The BoJ altered its inflation assessment slightly from saying prices are skewed to the downside from weakening. The U.S. government is open again but in 3 weeks time, we’ll be revisiting shutdown risks. NAFTA talks begin today. Its the 5th round and no real progress is expected but we’ll have to see if the U.S. threatens to pull out again or the Canadians express their concerns about U.S. departure. Sterling is also under pressure and could see 1.39 while NZD holds up well amidst U.S. dollar strength.

*The MAIN THEMES I see today are*

-GBP
-NZD
-AUD
+JPY

*Trading Biases*

+JPY, +CHF
-GBP, -NZD, -AUD
-USD/JPY (But +USD vs everything else)
mildly -CAD, -EUR

*Today’s Initial Trades*

1. Sell NZDCHF at market now .7031, Stop at .7059, Target .7003
2. Sell NZDUSD at market now .7315, stop at .7343, Target .7287
3. Bought EURGBP at .8784, Stop at .8756, Target .8812
4. Sell AUDJPY at 88.06, Stop at 88.34, Target 87.78

Close ALL open day trades by 10:20AM NY / 15:20 GMT

USDCAD +11
USDJPY -3
EURUSD -9