Today’s Trades 07.17.2018 EURUSD, USDCAD, AUDCHF, NZDJPY

Swing

*Good morning/afternoon everyone!*

It will be a big day in the FX market with Fed Chair Jay Powell testifying before Congress at 10AM NY time. From his prepared remarks we know that he’s optimistic about the U.S. economy but worried about trade tensions. The U.S. dollar is holding strong against the Yen ahead of the release and flat against other major currencies with the exception of the New Zealand dollar, which is up 0.63%. NZD soared on the back of stronger inflation data, taking out stops in the process. UK labor data was in line with expectations but slightly weaker than the previous month. Global bond yields are lower this morning, oil is below $70 a barrel and stocks are flat. The recent decline in oil leads us to believe that the loonie is due for a correction. We don’t expect much in the way of moves ahead of Powell’s speech but there could be some relative value plays.

*The MAIN THEMES I see today are*

+EUR
-AUD
-NZD
-CAD

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Buy USDCAD at 1.3145, Stop at 1.3117, Target 1.3173
2. Sell AUDCHF at .7362, Stop at .7390, Target .7334
3. Sell NZDJPY at 76.70, Stop at 76.98, Target 76.42
4. Buy EURUSD at 1.1721, Stop at 1.1693, Target 1.1749

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

Today’s Trades 07.10.2018 EURCAD, USDJPY, EURUSD, NZDUSD

Swing

*Good morning/afternoon everyone!*

Investors are buying U.S. dollars this morning on the back of higher U.S. rates and weaker global data. In the Eurozone, the ZEW survey deteriorated in July, causing EUR/USD to finally retreat after last week’s strong rally. We are looking for the pair to test 1.17 but with significant support at that former breakout level, its not clear if there will be a meaningful break. USD/JPY is eyeing its May 111.39 high -- although there are no major U.S. economic reports scheduled for release today, we believe this level will be tested with USD/JPY extending its gains to 111.50. Sterling is under pressure from ongoing political troubles in the UK and softer than expected industrial production. While USD/CAD is up, oil prices hit new highs today and that should limit the pair’s gains. We are short EUR/CAD because we still think CAD will outperform its ahead of Wednesday’s Bank of Canada rate decision. The worst performing currencies today are the Australian and New Zealand dollars. There’s no specific catalyst for their underperformance outside of regional weakness because business confidence increased in Australia and New Zealand credit card spending picked up in June.

*The MAIN THEMES I see today are*

-EUR
-NZD
+CAD
+USD
-JPY

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Sell EURCAD at 1.1594, Stop at 1.5422, Target 1.5366
2. Sell EURUSD at 1.1723, Stop at 1.1751, Target 1.1695
3. Sell NZDUSD at .6820, Stop at .6848, Target .6792
4. Buy USDJPY at 111.28, Stop at 111 Target 111.56

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

Today’s Trades 07.05.2018 AUDCHF, EURUSD, CADJPY, USDCAD

Swing

*Good morning/afternoon everyone!*

All of the major currencies are trading higher this morning on reports that the US and EU could drop their respective auto tariffs. No formal deal has been announced and there’s no mention by President Trump on twitter so it is too early to tell whether this story has real merit but it is driving risk on flows. However with the U.S. holiday bringing lower liquidity (many traders are off through the weekend) and trade war still a major issue the day before tariffs on China begin, investors remain nervous about retaliatory measures from China. Today’s ADP, Challenger and non-manufacturing ISM reports could also have a significant impact on the U.S. dollar ahead of Friday’s non-farm payrolls report. The best performing currency this morning is the euro followed by the deeply sold New Zealand dollar. All of the commodity currencies are trying to claw higher this morning. I like CAD in particular because of the continued uptick in oil along with the rise in Canadian bond yields. Sterling on the other hand saw very little benefit from BoE Governor Carney’s positive comments but that should be temporary following yesterday’s strong PMI services data. With the Fed expected to raise interest rates again this year, investors are hopeful that today’s U.S. economic reports will reaffirm the strength of the labor market.

*The MAIN THEMES I see today are*

+EUR
+CAD
+AUD
-JPY
-CHF

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Buy AUDCHF at .7331, Stop at .7304, .7360
2. Buy EURUSD at 1.1685, stop at 1.1657, Target 1.1713
3. Buy CADJPY at 81.16, Stop at 83.88, Target 84.44

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

Today’s Trades 06.20.2018 AUDUSD, EURUSD, CHFJPY, AUDNZD

Swing

*Good morning/afternoon everyone!*

While the U.S. dollar is trading higher against most of the major currencies this morning, the moves are relatively modest. Equities have stopped falling and yields are flat but after yesterday’s high anxiety trade, it is still too early to tell if this is the eye of the hurricane or the calm after the storm. The trade war is brewing strong with political risks continuing to haunt currencies. The worst performing currency today is the Swiss Franc followed by the euro and New Zealand dollar. There’s no news for Switzerland but jawboning by ECB member Nowotny who said he sees the euro falling against the dollar is hurting the currency. The EU also announced plans to impose 2.8 billion euros worth of tariffs on US imports on Friday. NZD on the other hand is pressured by softer consumer confidence and yesterday’s drop in dairy prices. GBP/USD fell to a fresh 7 month low ahead of a second Brexit vote, this time by the House of Commons on whether Parliament has a final say on the Brexit deal. The vote is expected around 18:30 GMT. While the U.S. releases existing home sales and its current account balance later this morning, the main focus will be on ECB President Draghi, Fed Chair Powell and BoJ Governor Kuroda’s comments in Sintra around 13:30 GMT. There’s also a number of OPEC headlines that could affect how the loonie trades. USD/CAD raced above 1.33 this morning and is still trying to figure out whether it has the strength to take out another big figure.

*The MAIN THEMES I see today are*

-EUR
-CHF
-GBP
-NZD
-AUD

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Sell AUDUSD at .7388, Stop at .7416, Target .7360
2. Sell EURUSD at 1.1563, Stop at 1.1591, Target 1.1535
3. Buy AUDNZD at 1.0735, Stop at 1.0707, Target 1.0763
4. Sell CHFJPY at 110.32, Stop at 110.60, Target 110.04

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

Today’s Trades 06.06.2018 – EURUSD, EURGBP, NZDCAD, EURNZD

Swing

*Good morning/afternoon everyone!*

All of the major currencies are trading higher this morning with EUR/USD above 1.1750, USD/JPY above 110 and GBP/USD above 1.34. Euro is benefitting from ECB comments relating to an earlier taper -- a view that we have emphasized after the 9 cent drop in the euro. Buyers continue to snap up USD/JPY ahead of next week’s Federal Reserve meeting. The Australian dollar also erased yesterday’s losses after a much stronger than expected GDP report. Risk ON is helping to take CAD and NZD higher as well and its no surprise to see the CHF and JPY underperform in a positive market environment like today. Yields are up across the board and equity futures point to a positive open. The Canadian dollar is in playwith trade balance and IVEY PMI reports scheduled for release -- the Bank of Canada’s optimism suggests that we could see firmer numbers. U.S. trade on the other hand could fall short of expectations given the strength of the dollar last month and the drop in the manufacturing ISM report.

*The MAIN THEMES I see today are*

+EUR
+AUD
+CAD
-CHF
-JPY

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Buy EURGBP at .8760, Stop at .8732, Target .8788
2. Sell NZDCAD at .9092, Stop at .9120, target .9064
3. Buy EURUSD at 1.1765, Stop at 1.1737, Target 1.1793
4. Buy EURJPY at 129.65, Stop at 129.37, Target 129.93

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

USDCAD +28
EURJPY +28
EURAUD
AUDUSD

EUR/USD – Levels to Watch Post ECB

EUR/USD – Levels to Watch Post ECB

Chart Of The Day

EUR/USD -- Levels to Watch Post ECB

EUR/USD is trading sharply lower ahead of the European Central Bank’s monetary policy announcement. Over the past 6 weeks there’s been widespread deterioration in business activity prompting investors to position for a dovish outlook. Even Germany’s Bundesbank head said recent indications for Germany in the first quarter were “not so brilliant.” However we can’t assume overwhelming dovishness from Draghi because last Friday he also said their confidence in the inflation outlook increased as the growth momentum is expected to continue. Inflation has also been on the rise so underneath the weakness there are positive developments. The question for Thursday is whether recent deterioration overshadows the uptick in inflation and positive growth momentum. We know that the ECB is not ready to raise interest rates and they certainly don’t want to see EUR/USD back above 1.24 because that would offset the improvements in prices. Yet they also want to end QE purchases this year -- so Mario Draghi has quite the balancing act to do on Thursday.

If ECB is dovish and the EUR/USD falls, the next stop should be 1.2100, which was resistance in early January and then 1.20, the 200-day SMA. EUR/USD has already broken below the 100-day SMA so the path of least resistance is lower. If they are not as dovish as investors anticipate and EURUSD finds itself back above 1.2250, the rally should extend to at least 1.2320.

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

EURUSD – Ready to Break 1.2200?

EURUSD – Ready to Break 1.2200?

Chart Of The Day

EURUSD has flirted with 1.2200 support for several days now. The level is critical as it represents a quadruple bottom all the way from 2017.
There are however good reasons to think that the pair may ready to break that key support level.

As US rates are climbing through the 3% level the ECB is getting left further and further behind. IFO economists predicted today hat German GDP would increase at 0.4% versus 0.6% rate of Q4 which is consistent with the latest PMI reading from the EZ.

The news is likely to keep ECB firmly neutral in its monetary policy stance on Thursday and the single currency could see further weakness if President Draghi suggests that the central bank many not consider tightening rates until well into 2019. 

If 1.2250 is given, the shorts will target 1.2000 as the next level of decline.

Today’s Trades 04.24.2018 – EURUSD, AUDCAD, AUDJPY, GBPJPY

Swing

*Good morning/afternoon everyone!*

After yesterday’s sharp gains, today’s moves can be best described as consolidation. The dollar is holding firm but many of the major currencies are positioning for a relief rally. Whether that happens or not will determined by Treasury yields, which are pulling back slightly at the start of the NY session. So far, 10 year rates have yet to breach 3% which is the key level to watch. Euro fell on the back of a weaker German IFO report but recovered all of its losses after bouncing off 1.22. Sterling found a bid from stronger fiscal finances but GBPUSD needs to rise above 1.3965 for the positive momentum to accelerate. There’s no specific explanation for why the New Zealand dollar is the weakest currency but AUD and CAD are vulnerable to short covering if U.S. yields fail to extend higher today. For the U.S., new home sales, consumer confidence and the CaseShiller house price index are scheduled for release. While new home sales could benefit from yesterday’s existing home sales jump, confidence could falter as geopolitical tensions in April rattle the markets.

*The MAIN THEMES I see today are*

+EUR
+GBP
+AUD
-JPY

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Buy AUDCAD at .9770, Target .9742, Target .9798
2. Buy EURUSD at 1.2214, stop at 1.2186, Target 1.2242
3. Buy AUDJPY at 82.78, Stop at .82.50, Target 83.06
4. Buy GBPJPY at 151.83, Stop at 151.55, Target 152.11

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

EUR/USD – Headed Below 1.22?

EUR/USD – Headed Below 1.22?

Chart Of The Day

EUR/USD – Headed Below 1.22?

Euro is trading lower ahead of next week’s European Central Bank’s monetary policy announcement. After consolidating for 8 trading days and failing to break above 1.24 throughout that time, the EUR/USD finally broke down on cautious comments from ECB member Weidmann. The head of Germany’s Bundesbank said there were recent indications that the first quarter in Germany was “not so brilliant.” However on Friday, ECB President Draghi also said growth momentum is expected to continue and their confidence in the inflation outlook increased but the euro-area growth cycle may have peaked. Euro will be the main focus in the week ahead with a central bank rate meeting, Eurozone PMIs, the German IFO report and German labor market numbers scheduled for release. Since the last monetary policy meeting we’ve seen more deterioration than improvement in the Eurozone’s economy. Therefore we don’t expect Mario Draghi’s outlook to improve materially this month as German sentiment and spending deteriorates. The ECB is not ready to signal the end of QE and they are not thinking about raising interest rates anytime soon. If the PMI and IFO reports, which will be released before the rate decision miss expectations, investors will position for renewed dovishness from the central bank. The risk is to the downside for euro and dovish comments from Draghi could drive EUR/USD to 1.22.

Technically, EUR/USD has fallen below the 20 and 50-day SMA. This breakdown after tight consolidation is significant and the next stop should be the 100-day SMA near 1.22 followed by 1.21. If EUR/USD manages to rebound and finds itself back above 1.2375, then a run above 1.24 becomes likely.
v

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

Today’s Trades 04.03.2018 – EURUSD, USDCHF, CHFJPY, EURAUD

Swing

*Good morning/afternoon everyone!*

While Monday’s sell-off in U.S. stocks carried over to Asian and European equities, it did not translate into further losses for currencies. USD/JPY is back above 106 and trading higher against the euro and sterling. Stronger than expected UK PMI manufacturing numbers failed to lift GBP and we think this is a sign of weakness rather than strength. The second quarter has begun and many traders are back from their Easter holidays though participation is still less than usual. The most important event risk this week will be Friday’s non-farm payrolls report so investors will be looking at all of the leading indicators ahead of the release. However there are no major U.S. economic reports today so between the positive open suggested by U.S. stock futures and the rise in 10 year Treasury yields, we could see further U.S. dollar strength vs. European currencies. Gains in USD/JPY appear to be capped below the 200-SMA on the 4 hour charts near 106.30 for the time being. The commodity currencies are outperforming with AUD supported by the central bank’s outlook for faster growth in 2018. They still maintain a steady policy stance. New Zealand has a dairy auction later this morning.

*The MAIN THEMES I see today are*

+USD
+AUD
-EUR
-CHF
-GBP

*Trading Biases*

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

*Today’s Initial Trades*

Here’s the summary --

1. Sell EURUSD at 1.2293, Stop at 1.2321, Target 1.2265
2. Sell EURAUD at 1.6000, Stop at 1.6028, Target 1.5972
3. Sell CHFJPY at 111.01, Stop at 111.29, Target 110.73
4. Buy USDCHF at .9567, Stop at .9539, Target .9595

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