The FX markets have been choppy and directionless in recent months and volumes (and profits) have been falling. Like equities we need some clear trends to emerge between the major fx pairs.
With great divergence between the dm nation’s economic progress (and inflation) it seems we are getting close to some new trends and it seems a reasonable probability that this is likely to include US$ strength.
The detail ill leave to the various teams. The recent strength of the euro move up caught many by surprise but few of the major have adjusted their position aside from short term tactical changes.
Here the detail:
And here JP with their most recent technical updates and trade alert rec.
And here CS with their FX weekly:
And here SC with their FX weekly from last week:
And here CB with their FX weekly technical analysis perspectives
And here a quick trade update from the Nomura tech team on the usdjpy:
And here the usdcad trade idea from the NB team
And here is Scotia on the latest CFTC report technical weekly report:
And here their friday tech wrap:
And finally here citi again with their daily from Friday:
If you are trading in the FX markets its near term trading whilst we sit within ranges for the moment. Until we get a clear macro move we have to be modest with targets. Its tempting to up deal size to maintain nominal margins but its a law of diminishing circles to do this and it also heaps more risk within this close quarter trading range. US$ strength looks the medium term conviction trade to me. JPY near term looking for strength to me given the 3 month distribution. Euro looking weak again due to the deflation/policy action move though whether this is still jaw boning is another matter. Eurusd has become a very tricky trade due to the dominant policy themes around the pair. (The Fitzpatrick analysis noted!). (April Seasonals positive Euro).
I still have a stack of macro and mm macro and technical trade reports to come towards the end of today.
All the best for now.
Rich