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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FX Daily, June 22: Markets Consolidate as Table is Set for Referendum

2016-06-23

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2016-06-23

There is a nervous calm in the capital markets today. The focus is squarely on tomorrow’s UK referendum. Brexit According to a BBC focus group, the leeave camp won the debate 39%-34%. The last polls show a contest that it too close to calls in that the results are within the margin of error.  The … Continue...

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More Thoughts on the Democratic Deficit

2016-06-23

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2016-06-23

It is not just that the polls indicate that the outcome of the UK referendum is too close to call, but the mere fact that the referendum is being held in the first place is significant.  It was not Labour, but the Conservative Party that brought the UK into the EU in the first place … Continue reading »

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Great Graphic: UK Referendum–Turnout it Key

2016-06-22

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2016-06-22

Younger age cohorts in the UK are more inclined to vote to stay in the EU than their elders. However, some suggested that this consideration is blunted by the fact that the younger people are less likely to vote.

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FX Daily, June 21: CHF Strongest Currency Again

2016-06-22

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2016-06-22

The Swiss Franc was the strongest currency. The euro fell from 1.0877 to 1.0808. Two fundamental reasons: Speculator anticipate that German investors buy Swiss francs in response to the court decision in favor of the OMT and the positive ZEW.

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European Politics Beyond the UK Referendum

2016-06-21

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2016-06-21

Sterling is hovering around seven cents above last week’s lows as many short-term participants better position themselves for the UK to vote to say in the EU, even though many opinion polls show a statistical dead heat.   The German Constitutional Court dismissed claims that the ECB’s Outright Market Transactions does not violate the German Constitution. …

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Great Graphic: Age and Brexit

2016-06-21

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2016-06-21

The betting and events markets have shifted more decisively than the polls in favor of the UK to remain in the EU.  Sterling extended its rally from $1.4010 last Thursday to nearly $1.4785 today, as the market participants adjust positions. What is particular striking is that the asymmetrical perceptions of the personal impact of a … Continue...

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FX Daily, June 20: Brexit not the main Swiss Franc Driver

2016-06-20

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2016-06-20

Recently I enumerated the different drivers for the continuing strength of the franc. Most commentators mentioned Brexit fears, but I insisted on the low rate and yield environment in the United States after the last Non-Farm Payroll report and the FOMC. Today's jump in sterling confirmed my view. This anticipation of an Anti-Brexit vote was not followed by a franc decline against USD. This also implies that a Brexit will not entrench a huge...

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If Sterling has Not Peaked, It has Come Pretty Close

2016-06-20

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2016-06-20

Today's sterling rally is the largest since 2008. The rally began with the murder of UK MP Cox. Risk-reward favors a near-term pullback.

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Bullard’s New Paradigm and the Federal Reserve

2016-06-20

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2016-06-20

There is much to like in Bullard's new paradigm. The problem is that it does not reflect the Federal Reserve's view or approach. Policy emanates from the Fed's leadership, but be confused by the noise.

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FX Weekly Preview: It is All about Europe

2016-06-19

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2016-06-19

Major data this week: German Constitutional Court ruling on OMT. UK referendum. EMU flash PMI. ECB TLTRO II launch. Yellen testifies before Congress, RBI Rajan to step down in early Sept.

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Weekly Speculative Postion: After Jo Cox Speculators Bought Sterling Futures with Both Hands

2016-06-18

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2016-06-18

In the days ahead of the murder of Jo Cox, a UK member of parliament, apparently for her support for remaining in the EU, speculators in the futures market scooped up sterling. While last week, speculators took long dollar positions against CHF, this barometer shifted this week towards long CHF.

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FX Review Week till June 17: Jo Cox’s death supports Sterling, negative for CHF

2016-06-18

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2016-06-18

Two main events that drove the foreign exchange market. The first iare some post-FOMC meeting movements and the assassination of Jo Cox, that might be positive for the Anti-Brexit camp . The EUR/CHF has fallen down to 1.0774 and recovered.

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Stay safe in your trading before the UK referendum vote. Key levels to lean against.

2016-06-17

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he UK referendum is upon us next week. Will the UK stay “In” or will they opt “Out”. In either case, traders will be nervous. Liquidity will likely be limited. Look for extremes BEFORE the event (that means at the beginning of the week – not and hour before the event!) Lean against them. IF …

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Does this remind you of your forex trading?

2016-06-17

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Having trouble pulling the trigger in your forex trading? Do you lunge at your forex trades with no rhyme or reason? Get help! Get a coach! The Attacking Currency Trends course will smooth your trading swing out. Do you want to hit it down the middle? For more information: https://forexlive.leadpages.co/act-four/ Or email Greg Michalowski at …

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FX Daily, June 17: Martyrdom of Cox Acts as Catharsis

2016-06-17

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2016-06-17

The assassination of Jo Cox, a member of the UK parliament is a personal and political tragedy.  Her needless death provided an inflection point.  The suspension of the referendum campaigns and a steady stream of reports and speech...

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How Germany Could Upset Europe before UK Referendum

2016-06-17

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2016-06-17

The assassination of the Jo Cox has broken the powerful momentum in the markets.  Investors recognize that the tragedy potentially injects a new element into consideration for the outcome of next week’s referendum.   The campaigns will be resume over the weekend, and new polls will be available.  Investors will place more weight on polls conducted …

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FX Daily, June 16: Markets are Anxious, Yen Soars

2016-06-16

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2016-06-16

The US dollar is higher against the major currencies but the Japanese yen and the New Zealand dollar.  The dollar fell to new two-year lows against the yen to JPY103.55 before bouncing in the European morning back to JPY104.40.  The...

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Macro Thinking: FOMC, USD, and EU

2016-06-16

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2016-06-16

The Federal Reserve modified its stance yesterday without changing rates.  It is not just about how fast the Fed sees itself normalizing monetary policy but also where the level of the equilibrium rate. The FOMC statement, but especially the officials’ forecasts (dot plots) effective unwound the impact of the earlier Fed talk of the likely …

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FX Daily, June 15: Key Data and FOMC

2016-06-15

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2016-06-15

The Swiss Franc was today on the back-foot against the euro, while the FOMC helped him to rise against the dollar. Yesterday Swiss producer prices were published. Negative changes in producer prices in 2015 reduce the Swiss franc overvaluation in terms of the Real Effective Exchange strongly. Now, however, changes producer prices are approaching zero again.

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Fed Softens Stance Slightly

2016-06-15

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2016-06-15

The immediate reaction was driven by the Fed's dot plots.  Although the median continues to expect two hikes this year, six officials now see only one hike.  Only one official anticipated one hike this year in the last forecasts made in March.  The m...

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