*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

Today’s Morning Views 06.15.2017 – Buy GBP, Buy USD

Swing

*Good morning/afternoon everyone!*

Right off the bat, the Bank of England shocked the markets today with 3 members calling for an immediate rate hike! Recent data including this morning’s UK retail sales report was terrible and yet, McCafferty, Forbes and Saunders think tightening is needed because core inflation has been stronger than expected and could overshoot while global growth and confidence is improving. They also see slack in the labor market diminishing. It was not enough to move rates today but its certainly an unexpectedly hawkish development. GBP should see more gains on this particularly vs. EUR, JPY and CHF.

Meanwhile today is an example of why picking the right pair combination is really important in trading. While the U.S. dollar is struggling to extend its gains versus JPY, it is higher against EUR and GBP (before BoE), allowing us to bank profits on our EUR/USD #1_easy2follow_trades. USD/JPY has a lot of resistance between 109.80 and 110 and then again at 110.66. With U.S. rates ticking only modestly higher, it may be a very slow crawl upwards for the pair. While we still see further losses in EUR, we bailed out early on our EUR/USD short because German 10 year yields are up significantly more than U.S. yields this morning. At the same time commodity currencies are losing their ground with AUD/USD flaming out despite strong labor data. NZD and CAD are likely to underperform EUR and USD.

*The MAIN THEMES I see today are*

GBP strength
EUR, CHF weakness
NZD, CAD underperformance
USD strength

*Trading Biases*
These will change after US data

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

*Today’s Potential Ideas*

Sell EUR/GBP at market now 0.8740, Stop at 0.8790, Target 0.8710
Buy USDCHF at market now 0.9738, Stop at 0.9688, Target 0.9768

USD/ CAD – Peaked?

USD/ CAD – Peaked?

Chart Of The Day

Fundamentals
USD/CAD has turned from one of the sleepiest currencies in the G-10 to one of the most volatile as the price of oil has effectively taken the unit hostage. But lately the swing in oil prices are having less and less impact on the pair as crude settles between $40-$50/bbl. Unless there is another sharp leg to the downside, it appears that the move in the loonie may be over for now with the pair having set a near term top at 1.2800 level. With the market paying less attention to the swings in WTI, the loonie is likely to move back to trading on fundamentals. Tomorrow’s Retail Sales could surprise to the upside especially since Wholesale sales have soared in the past month and that is likely to send USD/CAD even lower.
Technicals
USD/CAD has formed a clear triple top with lower highs suggesting that upward momentum is no longer there. The 1.2800 level remains the operative resistance to the topside while 1.2000 is most immediate near term support.

USD/JPY March Seasonality

forex seasonality Japanese Yen Kathy Lien

March is the fiscal year end in Japan and there tends to be a significant amount of repatriation of foreign earnings as companies look to window dress their balance sheets. This leads many investors to believe that USD/JPY will have a downward bias this month. However taking a look at how USD/JPY has behaved in March between 2001 and 2013, we can see that seasonality has very little impact on the currency pair. In fact over the past 6 years, USD/JPY appreciated 5 times in March. Therefore while seasonality is interesting, it should not be blindly traded.