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*Good morning/afternoon everyone!*
The U.S. dollar is trading higher against all of the major currencies today but stock futures are pointing to a sharply lower open (of course that could change quickly) as the Dow and S&P 500 hover under key technical levels. This makes USD/JPY’s rally vulnerable to a pullback and puts further downside pressure on other major currencies. There are no major U.S. economic reports but 10 year yields have topped 2.9%. A softer German ZEW survey drove EUR/USD below 1.2350 but at the start of NY trade, the single currency is trying to claw higher. The strongest currency outside of the greenback is the New Zealand dollar which is holding steady ahead of today’s dairy auction. Prices have been moving higher and another positive read is needed to maintain the pair’s uptrend. GBP ran up to 1.4016 on reports from UK minister Davis that a end of year deal is in the cards but has fallen off its highs since then. AUDUSD hit a 4 day low, USD/CAD is finding resistance near 1.26 – whether a pullback happens from here hinges on the performance of U.S. stocks but at minimum, oil prices are moving up, supporting a decline in USD/CAD.
*The MAIN THEMES I see today are*
+USD, +CAD, +NZD
-EUR, -GBP, -CHF, -AUD, -JPY
*Today’s Initial Trades*
Here’s the summary –
1. Sell CHFJPY at 114.57, Stop at 114.85, Target 114.29
2. Sell GBPNZD at 1.9988, stop at 1.9016, Target 1.8960
3. Sell EURUSD at 1.2346, Stop at 1.2374, Target 1.2318
4. Sell USDCAD at 1.2591, Stop at 1.2619, Target 1.2563
Close ALL open day trades by 10:20AM NY / 15:20 GMT