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.
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Drilling down into your forex trade

2017-01-13

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What does is the technical pictures say about the GBPUSDs story. The GBPUSD has moved higher over the last two days, but the ride has been up and down. Nevertheless, the technical pictures tell a story about that price action. That story follow a few chapters. The first chapter is from the perspective of the … Continue reading...

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FX Daily, January 12: Dollar and Yields Ease Further, but Look for Recovery

2017-01-12

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2017-01-12

breakdown
After a choppy North American session yesterday, the dollar and US yields remain under pressure. The dollar is lower against all the major currencies and most emerging market currencies, including the recently shellacked Turkish lira and Mexican peso.

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China Capital Flight: When $4 trillion is Too Much and $3 trillion is not Enough

2017-01-12

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2017-01-12

yuan
All of China's capital outflows are not capital flight fleeing. Capital controls limiting outflows can be tightened. Paying down dollar loans, a major source of capital outflows, is not an infinite process.

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FX Daily, January 11: Dollar Comes Back Bid

2017-01-11

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2017-01-11

FX Performance, January 11 2017 Movers and Shakers
The pound has seen a sharp fall following the interview that Theresa May gave with Sky news on Sunday although there has been a small rebound this afternoon. GBP CHF exchange rates are hovering around 1.2350 for this pair.

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Trump Is Set To Label China A “Currency Manipulator”: What Happens Then?

2017-01-11

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2017-01-11

China - BoP
While China has been banging the nationalist drums in its government-owned tabloids, warning daily of the adverse consequences to the US from either a trade war, or from Trump's violating the "One China" policy, a more tangible concern for deteriorating relations between China and the US is that Trump could, and most likely will, brand China a currency manipulator shortly after taking over the the Oval Office.

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Great Graphic: Real Rates in US are Elevated

2017-01-11

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2017-01-11

The US 10-year yield fell briefly below 1.32% last July. The yield slowly rose to reach 1.80% in mid-October. The day after the election, the yield initially slipped to almost 1.71%. This was a bit of a miscue, and the yield rose sharply to hit almost 2.64% the day after the FOMC hiked rates for the second time in the cycle on December 14. The yield backed off to hit 2.33% at the end of last week.

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FX Daily, January 10: Positioning more than Fundamentals Give Traders Pause

2017-01-10

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2017-01-10

FX Performance, January 10 2017 Movers and Shakers
After strong moves to start the year, the capital markets continue to consolidate. Many observers are suggesting a fundamental narrative behind the loss of momentum, but in discussions with clients and other market participants, it seems as if the main source of caution is coming from an understanding of market positioning rather than a reevaluation of the macro drivers.

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The Better Way: Backing into Smoot-Hawley and Repeating the Flaws of PPP

2017-01-10

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2017-01-10

Part of the US Republican tax reforms call for a border adjustment. It will tax imports fully and not exports. This will likely be challenged at the WTO. Many economists say the dollar will automatically appreciate by 20%. WE are bullish the dollar but skeptical of the logic here.

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Swiss Franc exchange rates receive double boost from UK uncertainty

2017-01-10

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2017-01-10

GBP/CHF - British Pound Swiss Franc, January 10
The Pound has had its worst day in two months yesterday, with exchange rates against most of its major currencies now reaching a two month low, and Swiss Franc exchange rates reaching down to the much dearer end of the 1.20’s once more.

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Forex technical analysis: AUDUSD making a break to the upside

2017-01-09

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Moves above 200 bar MA on 4-hour chart The AUDUSD is making a break above the 200 bar MA on the 4-hour chart. That MA held on Thursday and Friday last week. When you see a pattern develop that is then debunked, it says something is up. Can the momentum continue? If you like this … Continue reading »

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FX Daily, January 09: Sterling Pounded by May’s Hard Brexit

2017-01-09

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2017-01-09

Thor
Sterling has stolen the US dollar's spotlight. The issue facing market participants was if the rise in hourly earnings reported as part of the pre-weekend release of US December jobs data was sufficient to end the dollar's downside correction. Instead, May's comments over the weekend indicating not just a desire but strategic thrust to abandon the single market in exchange for regaining control over immigration and not being subject to the...

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What to look for on a technical break in your forex trading

2017-01-09

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What to look for in breaks and what to look for in failed breaks. The GBPJPY is making a bearish break today. Not only have we made a break below a prior resistance/support line but also below the 200 day MA. The question traders need to ask now is “Will the break keep the momentum … Continue reading...

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Weekly Speculative Positions: CHF and GBP net shorts are slowly rising again

2017-01-09

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2017-01-09

Speculative Positions Commitments of traders Swiss Franc - 09.01
Speculators are net short CHF with 13K contracts against USD, 3K more than last week. This is still far from the post financial crisis record of 26 K contracts. Moreover the net short GBP are increasing again.

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FX Weekly Preview: Macro Forces Underpin Dollar, Equities and Yields

2017-01-09

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2017-01-09

Rushmore
Odds of a March Fed hike edged up last week, and Q4 GDP figures were revised higher. Many continue to expect the new US Administration to pursue pro-growth tax reform, deregulation and infrastructure spending. Although many other high income countries are growing, near trend divergence of monetary policy continues.

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FX Weekly Review, January 02 – 07: Is the corrective phase of the dollar over?

2017-01-08

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2017-01-08

US Dollar/Swiss Franc FX Spot Rate, December 30
The lack of full participation and the resulting choppy conditions may have obscured the signal from the capital markets. That signal we think was one of correction since shortly after the Fed's rate hike in id-December. The question now, after the US employment data showed continued labor market strength and that earnings improvement remains intact, is whether the corrective phase is over.

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US Jobs Details Better than the Headline

2017-01-07

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2017-01-07

The dollar and US yields are recouping more of yesterday’s decline. A break of $1.0480-$1.05 would suggest the euro’s upside bounce is exhausted. A dollar move above JPY116.80-JPY117.25 would also hint that the greenback was going to make an other run toward JPY118.30-JPY118.60. Sterling support is seen in the $1.2285-$1.2310 area.

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Cool Video: CNBC’s Power Lunch-China and Mexico

2017-01-07

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2017-01-07

Marc Chandler - Bloomberg
Two central banks were particularly active today. Chinese officials appear to be engineering short squeeze that has lifted the yuan 1.2% over the past two sessions. While this does not sound like much, it is a record two-day move, for the still closely managed currency.

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FX Daily, January 06: Dollar Consolidates Losses, Peso Firms while Yuan Reverses

2017-01-06

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2017-01-06

FX Performance, January 06 2017 Movers and Shakers
I am reading a lot about the pound in 2017 which is likely to be as volatile as in 2016. But the Franc is a harder beast to predict. Loosely tracking the euro but subject to its own rules and trends GBPCHF could be an interesting pair to watch in 2017. There are numerous global events which can shape the direction on the Franc and clients looking to exchange pounds into Francs or move Francs back to the UK should be considering the path ahead.

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A Few Thoughts Ahead of the US Jobs Report

2017-01-06

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2017-01-06

ADP and Non-Manufacturing ISM lend credence to our fear of a disappointing national jobs report. Economists estimate only a small part of the manufacturing jobs loss can be traced to trade policy. 19 states increased min wage at the start of the year, but the impact on the nation's average weekly earnings will likely be too small to detect.

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When your forex trading risk is really low, reward does not really matter

2017-01-05

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Risk a little to make more than a little… There are times when a forex technical level is important enough to just focus on the risk, and forget about the reward. In other words, if you trade at a key level where risk is only 5 pips, you only have to see the market move … Continue reading...

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