Category Archive: 4) FX Trends

Main Author Marc Chandler
Marc Chandler
He has been covering the global capital markets in one fashion or another for more than 30 years, working at economic consulting firms and global investment banks. After 14 years as the global head of currency strategy for Brown Brothers Harriman, Chandler joined Bannockburn Global Forex, as a managing partner and chief markets strategist as of October 1, 2018.

FX Daily, September 26: Weekend Election and North Korea Rhetoric Helps Greenback Remain Firm

The US dollar is firmer against most major currencies today. The implications the Jamaica coalition in Germany is understood to be less likely to support a new vision for Europe in the aftermath of Brexit and the Great Financial Crisis. The euro's low for the year was set at the very start near $1.0340. The first quarter or so was spent consolidating the gains in H2 16. It was trading below $1.06 in early April.

Read More »

FX Daily, September 25: Euro and Kiwi Dragged Lower

The end of the Grand Coalition in Germany and the need for a coalition in New Zealand are weighing on the respective currencies. The euro was marked down in Asia and briefly dipped below $1.19 before recovering to $1.1940 by the middle of the Asian session. It was sold to new lows in the European morning after the weaker than expected IFO survey. Today's survey stands in contrast to the recent PMI and ZEW survey and matches the mood of the market....

Read More »

FX Weekly Preview: Old and New Drivers in the Week Ahead

Last week's developments will continue to shape the investment climate in the week ahead, and at the same time, new inflation readings from the US, EMU, and Japan will add incrementally to investors' information set.

Read More »

Abe and BOJ

BOJ is unlikely to change policy. A snap election suggests continuity of policy. US 10-year yield remains one of most important drivers of the exchange rate.

Read More »

Is the EURUSD ready to get out of this narrow range? I think so!

Is the EURUSD ready to get out of this narrow range? I think so and I will tell you why and what to look for in this video.

Read More »

FX Daily, September 22: Markets Limp into the Weekend

The cycle of sanctions, recriminations, and provocative actives continues as the Trump Administration leads a confrontation with North Korea. The US announced yesterday new round of sanctions on North Korea. Reuters reported that the PBOC has instructed its banks not to take on new North Korean clients and to begin unwinding existing relationships.

Read More »

FX Daily, September 21: Market Digests Fed, Greenback Consolidates, Antipodeans Tumble

The market has mostly interpreted the Fed's action in line with our thinking. Despite the lowering of the long-run Fed funds rate, the shifting one of the three hikes from 2019 into 2020, and recognizing that the weaker price impulses are somewhat mysterious, the Fed clearly signaled its bias toward hiking rates one more time this year and three next year.

Read More »

FX Daily, September 20: Shrinkage and Beyond

After much anticipation, the FOMC decision day is here. Much of the focus is on the likely decision that the Fed will allow its balance sheet to shrink gradually. No other country who employed quantitative easing has is in a position to begin unwinding the emergency expansion of its balance sheet. The Fed's experience in QE, communication, and now unwinding, will be part of the information set other central banks can draw upon.

Read More »

FX Daily, September 18: More Thoughts from Berlin

The unexpected weakness in US retail sales and industrial production reported before the weekend did not prevent US yields and stocks from rising.  Asia followed suit, and with Japanese markets closed, the MSCI Asia Pacific Index rallied a little more than 1%, the largest gain in two months.  Of note, foreigners returned to the Korean stock market, buying about $260 mln today, which cuts the month's liquidation in half.  The Kospi rallied 1.3%...

Read More »

FX Weekly Preview: FOMC Highlights Big Week

The days ahead are historic. By all reckoning, Merkel will be German Chancellor for a fourth consecutive term. Many observers expect the election to usher in a new era of German-French coordination to continue the European project post-Brexit and in the aftermath of the Great Financial Crisis.

Read More »

FX Daily, September 15: Short Note Ahead of the Weekend

Sporadic updates continue as the first of two-week business trip winds down. North Korea missile launch failed to have much impact in the capital markets. The missile apparently flew the furthest yet, demonstrating its ability to hit Guam. However, there was not an immediate response from the US. South Korea said it had simultaneously conducted its own drill which included firing a missile into the Sea of Japan (East Sea).

Read More »

FX Daily, September 14: New Trump Tactics Help Greenback and Rates

In the face of much cynicism and pessimism about the outlook for the Trump Administration's agenda, we have repeatedly pointed out the resilience of the system of checks and balances. Many of the more extreme positions have been tempered, either on their own accord, such as naming China a currency manipulator or pulling out of NAFTA or KORUS, or the judiciary branch, such as on immigration curbs, or the legislative branch itself, as in limiting the...

Read More »

FX Daily, September 13: Sterling Shines While Euro Stalls in Front of $1.20

The next leg of the business trip takes me to Frankfurt. Sporadic updates will continue. We have been identifying the $1.3430 area is a reasonable technical target for sterling. It represents the 50% retracement of sterling's losses since the day of the referendum June 2016 when it briefly traded $1.50. Also helping sterling is the unwinding of short cross positions against the euro.

Read More »

FX Daily, September 12: Dollar Sports Heavier Tone as Yesterday’s Bounce Runs out of Steam

The sporadic updates continue while I am on a two-week business trip. Now in Barcelona, participating in TradeTech FX Europe. The euro advanced yesterday from NOK9.30 to NOK9.40. It is consolidating in a tight range today. The election results may have been a bit closer than expected, but the weight on the krone yesterday seemed to stem more from the unexpectedly soft inflation report.

Read More »

FX Weekly Preview: Forces of Movement in FX: The Week Ahead

The dollar has been declining since the start of the year, but the causes have changed. The drag from US politics may be exaggerated, while European and Japanese politics are worrisome. The economic data may continue to be a drag on US yields, especially if core CPI slips again.

Read More »

FX Weekly Review, September 04 – 09: Draghi Dovish? EUR and USD falling against CHF

The euro rose close to CHF 1.15 with the ECB meeting this week. Finally traders realized that the ECB committed not to hike rates for a very long time. The ECB will review and take a first decision on the bond purchasing program this autumn. However, this program will come to an end only when the inflation target of 2% becomes in reach.

Read More »

I have the worst trading mantra

There is a grain of truth in every trading mantra and maxim but everybody has one that he or she likes best. Adam Button from ForexLive talks about his trading mantra, how he wishes it something with a bit more pizzazz. LET’S CONNECT! Facebook ► http://facebook.com/forexlive Twitter ► https://twitter.com/ForexLive Google+ ► https://plus.google.com/+Forexlive Homepage ► http://www.forexlive.com/

Read More »

FX Daily, September 08: US Dollar Tracks Yields Lower

The US dollar has been unable to find any traction as US yields continue to move lower. The US 10-year year is slipping below 2.03% in European turnover, the lowest level in ten months. The risk, as we have noted, is that without prospects of stronger growth and inflation impulses, the yield returns to where was before the US election (~1.85%). The two-year note yield, anchored more by Fed policy than the long-end,  is also soft. It yielded 1.25%...

Read More »

FX Daily, September 07: ECB Focus for Sure, but not Only Game in Town

The US dollar is trading broadly lower. The ECB meeting looms large. Many, like ourselves, expected that when Draghi said in July that the asset purchases would be revisited in the fall, it to meant after the summer recess, not a legalistic definition of when fall begins. Still, there have been some reports, citing unnamed sources close to the ECB, that have played down such expectations, and warn a decision on next year’s intentions may not be...

Read More »