Friday, August 23, 2013
Some Update
Hi all,
Have a look on the new charting software that i've put as a widget at the bottom. Feel free to use it and you can register for yourself a free TradingView account.
Have a look on the new charting software that i've put as a widget at the bottom. Feel free to use it and you can register for yourself a free TradingView account.
Who's Buying All Of These Euros? - Citi
23 AUG 2013 01:01 EDT
By eFXnews.com
Focus of the day:
"The euro’s recent strength is driven by real money flows and the unwind of EM positions. As highlighted in our Flow Report, last week hedge funds were selling EUR, but non-leveraged accounts (real money) were large buyers. On a directional basis, the real money flows are larger than the three remaining client types. We have seen such a pattern before, in early 2013 and most recently in June 2013. In both instances, when EM Asian FX weakened, EUR-USD rallied – breaking its long standing correlation. Eventually the USD correlation returned - 12 days the first time and four weeks the second. The lower the EZ tail risk is – the more likely it is seen as an alternative region of growth to the US. The better European economic outlook is encouraged investor flow to diversify and undervalued European equities are still an attractive magnet. Real Money’s long EM position still remains the largest exposure that client type has, and Citi FX flows have only just begun to capture net outflows from the LatAm, EMEA and Asian regions. Real money flows tend to be sticky and make calling a reversal difficult. However, if the EUR flow is predicated on better growth and economic outlook, it should be highly sensitive to data surprises."
Richard Cochinos, Citibank.
"The euro’s recent strength is driven by real money flows and the unwind of EM positions. As highlighted in our Flow Report, last week hedge funds were selling EUR, but non-leveraged accounts (real money) were large buyers. On a directional basis, the real money flows are larger than the three remaining client types. We have seen such a pattern before, in early 2013 and most recently in June 2013. In both instances, when EM Asian FX weakened, EUR-USD rallied – breaking its long standing correlation. Eventually the USD correlation returned - 12 days the first time and four weeks the second. The lower the EZ tail risk is – the more likely it is seen as an alternative region of growth to the US. The better European economic outlook is encouraged investor flow to diversify and undervalued European equities are still an attractive magnet. Real Money’s long EM position still remains the largest exposure that client type has, and Citi FX flows have only just begun to capture net outflows from the LatAm, EMEA and Asian regions. Real money flows tend to be sticky and make calling a reversal difficult. However, if the EUR flow is predicated on better growth and economic outlook, it should be highly sensitive to data surprises."
Richard Cochinos, Citibank.
Copyright © 2013 eFXnews
Thursday, August 22, 2013
Citi's Portfolio: USD Longs Largest Position; Increases EUR longs, CAD Shorts
22 AUG 2013 13:24 EDT
By eFXnews.com
Citibank made several changes to its overlay portfolio this week
including raising the EUR weight to +5 overweight from market neutral,
raising the CHF underweight to -5 from -10 and lowering the CAD
underweight to -10 from -5.
"The raising of the EUR overweight and CHF underweight reflects our expectation for increased capital flows to Europe from Emerging Markets. Equity and fixed income investments in EM should continue to unwind into September, and investors seek diversified safe havens," Citi outlines its bias on EUR and CHF.
"For Canada, we anticipate additional attention on the 4 September BOC meeting leading to CAD weakness," Citi outlines its bias on CAD.
Meanwhile, Citi kept the USD overweight as the largest position in the portfolio.
"With the FOMC on track to begin tapering in September, we anticipate the USD will continue to outperform in Q3," Citi projects.
"The raising of the EUR overweight and CHF underweight reflects our expectation for increased capital flows to Europe from Emerging Markets. Equity and fixed income investments in EM should continue to unwind into September, and investors seek diversified safe havens," Citi outlines its bias on EUR and CHF.
"For Canada, we anticipate additional attention on the 4 September BOC meeting leading to CAD weakness," Citi outlines its bias on CAD.
Meanwhile, Citi kept the USD overweight as the largest position in the portfolio.
"With the FOMC on track to begin tapering in September, we anticipate the USD will continue to outperform in Q3," Citi projects.
Copyright © 2013 eFXnews
Time To Buy AUD/NZD Targeting 1.1855: A New Macro Trade - ANZ
22 AUG 2013 15:42 EDT
By eFXnews.com
Australia and New Zealand Banking Group (ANZ) entered into a fresh
macro tactical trade at 1.1482 with a target at 1.1855 and a stop at
1.1220.
"The coming FOMC tapering is testing the durability of economies in Asia that rely on easy money financing. A side effect of New Zealand’s macro-prudential measures introduced this week is to discourage capital inflows, meaning policymakers there are actually working in the same direction as the FOMC, and doubling-up the downward pressure on the NZD within the broader context of Asian financial market stress," ANZ says as a rationale behind this call.
"Finally, while we are conscious that periods of tight conditions in global financial markets often pressure the AUD more than the NZD, we are less certain this time around. In the past, the tail risk in Australia has increased above that in New Zealand. This was especially true in the crisis and was neatly reflected by the risk reversal moving to previously uncharted levels. At the time, the exchange rate followed the tail risk. This is not the case this time around – the market currently sees tail risks as roughly evenly balanced," ANZ adds.
"The coming FOMC tapering is testing the durability of economies in Asia that rely on easy money financing. A side effect of New Zealand’s macro-prudential measures introduced this week is to discourage capital inflows, meaning policymakers there are actually working in the same direction as the FOMC, and doubling-up the downward pressure on the NZD within the broader context of Asian financial market stress," ANZ says as a rationale behind this call.
"Finally, while we are conscious that periods of tight conditions in global financial markets often pressure the AUD more than the NZD, we are less certain this time around. In the past, the tail risk in Australia has increased above that in New Zealand. This was especially true in the crisis and was neatly reflected by the risk reversal moving to previously uncharted levels. At the time, the exchange rate followed the tail risk. This is not the case this time around – the market currently sees tail risks as roughly evenly balanced," ANZ adds.
Copyright © 2013 eFXnews
EUR/USD Negative Divergence Points To A Sell-Off; Go Short At Mkt For 1.28 - Commerzbank
22 AUG 2013 12:10 EDT
By eFXnews.com
The break out of Wednesday’s EUR/USD inside day is likely to determine the trend for the next few days, projects Commerzbank.
"Since it is to the downside and because we see negative divergence on the daily RSI, we believe that another interim top could now be in place at this week’s 1.3453 high," CB argues.
Confirmation of this, according to CB, would be a drop through the steep two month support line at 1.3290 and a fall through Tuesday’s 1.3323 low, but only a drop through the next lower 1.3208/1.3188 support area will mean that a significant top has been made.
To negate this immediate bearish view, CB thinks that a a rise above the 1.3427 Wednesday high would be needed.
"In this case, Tuesday’s 1.3453 peak should be overcome with the 1.3500/20 region then being reached. It consists of the minor psychological level and 13th February high. This is regarded as the last defence for the 1.3711 February high. We do not favour such a strong rise, though, and believe that the currency pair has already topped out," CB adds.
In line with this view, CB enters into a technical tactical short EUR/USD at market (1.3340) with a stop at 1.3455, and a target at 1.2800.
"Since it is to the downside and because we see negative divergence on the daily RSI, we believe that another interim top could now be in place at this week’s 1.3453 high," CB argues.
Confirmation of this, according to CB, would be a drop through the steep two month support line at 1.3290 and a fall through Tuesday’s 1.3323 low, but only a drop through the next lower 1.3208/1.3188 support area will mean that a significant top has been made.
To negate this immediate bearish view, CB thinks that a a rise above the 1.3427 Wednesday high would be needed.
"In this case, Tuesday’s 1.3453 peak should be overcome with the 1.3500/20 region then being reached. It consists of the minor psychological level and 13th February high. This is regarded as the last defence for the 1.3711 February high. We do not favour such a strong rise, though, and believe that the currency pair has already topped out," CB adds.
In line with this view, CB enters into a technical tactical short EUR/USD at market (1.3340) with a stop at 1.3455, and a target at 1.2800.
Copyright © 2013 eFXnews
Monday, August 19, 2013
EUR Traders Beware, Italian Politics To Soon Return To The Spotlight
19 AUG 2013 22:42 EDT
Frederik Ducrozet, Senior Economist - Eurozone
Crédit Agricole via eFXnews
In the meantime, Italian politics could well return to the spotlight, possibly bringing some market-friendly headlines notwithstanding the inherent fragility of the situation. Speaking at the Rimini annual meeting on Sunday, Prime Minister Letta insisted on the need to change the electoral law, adding that a proposal aimed at forbidding the public financing of political campaigns will be submitted for approval to the Lower House in October.
Some further progress on that matter can not be ruled out as soon this week. Mr Letta also said that his government would continue to implement structural reforms while keeping the commitment to reduce public spending and cut (some) taxes.
Meanwhile Flavio Zanonato, the Minister of Economic Development, explained that a solution should be found to reduce the property tax by the end of the month – the infamous IMU on main residences which was introduced by Berlusconi in 2012. In addition, Mr Zanonato announced that the government has been preparing a “package” of economic initiatives to help SMEs to restore their competitiveness, including an emergency measure to cut electricity prices.
Commerzbank Sells USD/JPY From 97.90; Stands Flat On EUR/USD
19 AUG 2013 14:04 EDT
By eFXnews.com
Commerzbank entered into a technical tactical short USD/JPY from 97.90, with a stop at 98.90, and a target at 94.80.
"USD/JPY shot up to 98.66 before slipping again. A continued slide should be seen in the days to come while this high caps. As long as it does, the 78.6% Fibonacci retracement of the June-to-July rise at 95.42 will remain in focus. Below it lies the five month support line at 94.82. Over the coming weeks we allow for losses back to the 93.95/75 support area. This is where the June low and the 200 day moving average are," CB says as a rationale behind this call.
Meanwhile, CB stands flat on EUR/USD after stopping out of its last short position last week on a tiny loss.
"Last week EUR/USD reached the 1.3208/1.3188 support zone (July 11 high and the current August low) from where it accelerated higher. The August high at 1.3401 is thus back into the picture. A rise above the 1.3419 June peak would suggest ongoing strength to 1.3500/20, the minor psychological level and 13th February high. This is regarded as the last defence for the 1.3711 February high. We do not favour such a strong rise, though, and believe that the currency pair will falter around the 1.3500 mark," CB outlines its current technical bias on the pair.
"Only a drop through the 1.3208/1.3188 support area will alleviate upside pressure. Failure here will target the 1.3000 region. Loss of this zone is needed to re-target the 1.2755/40 July and April lows," CB adds.
"USD/JPY shot up to 98.66 before slipping again. A continued slide should be seen in the days to come while this high caps. As long as it does, the 78.6% Fibonacci retracement of the June-to-July rise at 95.42 will remain in focus. Below it lies the five month support line at 94.82. Over the coming weeks we allow for losses back to the 93.95/75 support area. This is where the June low and the 200 day moving average are," CB says as a rationale behind this call.
Meanwhile, CB stands flat on EUR/USD after stopping out of its last short position last week on a tiny loss.
"Last week EUR/USD reached the 1.3208/1.3188 support zone (July 11 high and the current August low) from where it accelerated higher. The August high at 1.3401 is thus back into the picture. A rise above the 1.3419 June peak would suggest ongoing strength to 1.3500/20, the minor psychological level and 13th February high. This is regarded as the last defence for the 1.3711 February high. We do not favour such a strong rise, though, and believe that the currency pair will falter around the 1.3500 mark," CB outlines its current technical bias on the pair.
"Only a drop through the 1.3208/1.3188 support area will alleviate upside pressure. Failure here will target the 1.3000 region. Loss of this zone is needed to re-target the 1.2755/40 July and April lows," CB adds.
Copyright © 2013 eFXnews
Outlooks & Strategies For EUR/USD, GBP/USD, USD/JPY, & AUD/USD - Barclays
19 AUG 2013 11:38 EDT
By eFXnews.com
The following are the latest technical outlooks and strategies for
EUR/USD, GBP/USD, USD/JPY and AUD/USD as provided by the technical
strategy team at Barclays Capital.
EUR/USD: The USD is caught between strengthening forces against EM and weakening potential against some commodity currencies. Meanwhile, EUR/USD is caught in range between 1.3200 and 1.3420. We are looking to sell rallies within range.
USD/JPY: We expect 99.30/70 to cap rallies this week as price chops slowly lower towards 96.00. In the very short term, we are prepared to be patient, looking to sell bounces rather than chasing weakness.
GBP/USD: We are looking to scale into a short position. A move above 1.5775 (or a close above 1.5750) would prove our view incorrect. Until then, we expect a return to 1.5420 and potentially lower.
AUD/USD: Upside risks are increasing as a position squeeze is likely. A move above 0.9250 would confirm a test of 0.9320/50 before we can look to sell. An intraday break below 0.9150 would turn us bearish again.
EUR/USD: The USD is caught between strengthening forces against EM and weakening potential against some commodity currencies. Meanwhile, EUR/USD is caught in range between 1.3200 and 1.3420. We are looking to sell rallies within range.
USD/JPY: We expect 99.30/70 to cap rallies this week as price chops slowly lower towards 96.00. In the very short term, we are prepared to be patient, looking to sell bounces rather than chasing weakness.
GBP/USD: We are looking to scale into a short position. A move above 1.5775 (or a close above 1.5750) would prove our view incorrect. Until then, we expect a return to 1.5420 and potentially lower.
AUD/USD: Upside risks are increasing as a position squeeze is likely. A move above 0.9250 would confirm a test of 0.9320/50 before we can look to sell. An intraday break below 0.9150 would turn us bearish again.
Copyright © 2013 eFXnews
When Will EUR/USD Finally Decline? - Commerzbank
19 AUG 2013 01:09 EDT
By eFXnews.com
Focus of the day:
"Although most analysts – ourselves included – expect EUR-USD to decline, the euro’s strength continues. Where is the widely expected euro weakness and should not the mere expectation of depreciation send the euro lower in an efficient market? We argue that the factors which have recently supported EUR-USD are temporary. Over time they will cease to exist and EUR-USD is, in our view, likely to decline over the medium-term.
The market doubts the “forward guidance” of the ECB: One reason for the recent strength of EUR-USD is the positive surprises coming from the economic data front in the euro zone. Although US data have for the most part also come in above expectations, the euro zone has clearly outperformed the USA as regards positive surprises, especially from mid-July onwards.
… and the tapering trajectory of the Fed remains uncertain: At the same time, many market participants seem to doubt whether the Federal Reserve is indeed set to reduce (taper) its bond purchases any time soon. In mid-June, the Fed firmed up its strategy for pulling back from its bond-buying programme and announced a time schedule for the tapering process.
Sooner or later, the Fed will taper: Nonetheless, we are firmly convinced that the Fed will indeed start to scale back its bond purchases by year-end. One argument supporting our view is that the negative impact of the restrictive fiscal measures, which were implemented at the beginning of the year, is already beginning to fade. Hence, the US economy looks set to gather considerable momentum in the second half of the year.
… and the ECB will keep interest rates at ultra-low levels for a long time to come: Whilst the Fed is set to scale back monetary accommodation in the months ahead, the same is not to be expected of the ECB. Despite the euro zone’s turnaround in the second quarter and increasing signals of hope from the periphery, the “forward guidance“ of the ECB continues to be credible, in our opinion.
Positioning standing in the way of a smooth downward movement of EUR-USD: Whilst there are good reasons for EUR-USD to weaken, this is unlikely to materialise unless the market environment allows for such a movement. As market consensus expects EUR-USD to weaken, price-sensitive market participants keep piling up EUR short positions from time to time. However, as long as there are doubts about the arguments for a weaker EUR-USD, speculative market participants will likely be unwilling to hold excessive EUR short positions. In other words: Sending a EUR-USD bearish forecast to Bloomberg is one thing, large-scale betting on it is another.
Market participants who patiently wait for the fundamentals to play out ought to be rewarded in the end. Even if we now expect the beginning of the downward movement of EURUSD a little later, we stick to our view that EUR-USD will drop below 1.30 by year-end. By the middle of next year, we expect to see levels in the mid-1.20s area."
Ulrich Leuchtmann, Commerzbank
"Although most analysts – ourselves included – expect EUR-USD to decline, the euro’s strength continues. Where is the widely expected euro weakness and should not the mere expectation of depreciation send the euro lower in an efficient market? We argue that the factors which have recently supported EUR-USD are temporary. Over time they will cease to exist and EUR-USD is, in our view, likely to decline over the medium-term.
The market doubts the “forward guidance” of the ECB: One reason for the recent strength of EUR-USD is the positive surprises coming from the economic data front in the euro zone. Although US data have for the most part also come in above expectations, the euro zone has clearly outperformed the USA as regards positive surprises, especially from mid-July onwards.
… and the tapering trajectory of the Fed remains uncertain: At the same time, many market participants seem to doubt whether the Federal Reserve is indeed set to reduce (taper) its bond purchases any time soon. In mid-June, the Fed firmed up its strategy for pulling back from its bond-buying programme and announced a time schedule for the tapering process.
Sooner or later, the Fed will taper: Nonetheless, we are firmly convinced that the Fed will indeed start to scale back its bond purchases by year-end. One argument supporting our view is that the negative impact of the restrictive fiscal measures, which were implemented at the beginning of the year, is already beginning to fade. Hence, the US economy looks set to gather considerable momentum in the second half of the year.
… and the ECB will keep interest rates at ultra-low levels for a long time to come: Whilst the Fed is set to scale back monetary accommodation in the months ahead, the same is not to be expected of the ECB. Despite the euro zone’s turnaround in the second quarter and increasing signals of hope from the periphery, the “forward guidance“ of the ECB continues to be credible, in our opinion.
Positioning standing in the way of a smooth downward movement of EUR-USD: Whilst there are good reasons for EUR-USD to weaken, this is unlikely to materialise unless the market environment allows for such a movement. As market consensus expects EUR-USD to weaken, price-sensitive market participants keep piling up EUR short positions from time to time. However, as long as there are doubts about the arguments for a weaker EUR-USD, speculative market participants will likely be unwilling to hold excessive EUR short positions. In other words: Sending a EUR-USD bearish forecast to Bloomberg is one thing, large-scale betting on it is another.
Market participants who patiently wait for the fundamentals to play out ought to be rewarded in the end. Even if we now expect the beginning of the downward movement of EURUSD a little later, we stick to our view that EUR-USD will drop below 1.30 by year-end. By the middle of next year, we expect to see levels in the mid-1.20s area."
Ulrich Leuchtmann, Commerzbank
Copyright © 2013 eFXnews
Good afternoon everyone.
Just finished a week enjoying with my family. Hope all of you are doing fine as well. A bit on my forex account. As you noticed on my fxstats widget my account gain is currently at -90%. but this doesn't stop me (yet) on continuing to learn how to make my trading profitable.
Trends & Levels For EUR/USD, EUR/JPY, & EUR/CHF
19 AUG 2013 16:00 EDT
By eFXnews.com
The following are the trends and levels for EUR/USD, EUR/JPY, and
EUR/CHF as provided by the technical strategy team at Erste Group.
Copyright © 2013 eFXnews
Commerzbank Sells USD/JPY From 97.90; Stands Flat On EUR/USD
19 AUG 2013 14:04 EDT
By eFXnews.com
Commerzbank entered into a technical tactical short USD/JPY from 97.90, with a stop at 98.90, and a target at 94.80.
"USD/JPY shot up to 98.66 before slipping again. A continued slide should be seen in the days to come while this high caps. As long as it does, the 78.6% Fibonacci retracement of the June-to-July rise at 95.42 will remain in focus. Below it lies the five month support line at 94.82. Over the coming weeks we allow for losses back to the 93.95/75 support area. This is where the June low and the 200 day moving average are," CB says as a rationale behind this call.
Meanwhile, CB stands flat on EUR/USD after stopping out of its last short position last week on a tiny loss.
"Last week EUR/USD reached the 1.3208/1.3188 support zone (July 11 high and the current August low) from where it accelerated higher. The August high at 1.3401 is thus back into the picture. A rise above the 1.3419 June peak would suggest ongoing strength to 1.3500/20, the minor psychological level and 13th February high. This is regarded as the last defence for the 1.3711 February high. We do not favour such a strong rise, though, and believe that the currency pair will falter around the 1.3500 mark," CB outlines its current technical bias on the pair.
"Only a drop through the 1.3208/1.3188 support area will alleviate upside pressure. Failure here will target the 1.3000 region. Loss of this zone is needed to re-target the 1.2755/40 July and April lows," CB adds.
"USD/JPY shot up to 98.66 before slipping again. A continued slide should be seen in the days to come while this high caps. As long as it does, the 78.6% Fibonacci retracement of the June-to-July rise at 95.42 will remain in focus. Below it lies the five month support line at 94.82. Over the coming weeks we allow for losses back to the 93.95/75 support area. This is where the June low and the 200 day moving average are," CB says as a rationale behind this call.
Meanwhile, CB stands flat on EUR/USD after stopping out of its last short position last week on a tiny loss.
"Last week EUR/USD reached the 1.3208/1.3188 support zone (July 11 high and the current August low) from where it accelerated higher. The August high at 1.3401 is thus back into the picture. A rise above the 1.3419 June peak would suggest ongoing strength to 1.3500/20, the minor psychological level and 13th February high. This is regarded as the last defence for the 1.3711 February high. We do not favour such a strong rise, though, and believe that the currency pair will falter around the 1.3500 mark," CB outlines its current technical bias on the pair.
"Only a drop through the 1.3208/1.3188 support area will alleviate upside pressure. Failure here will target the 1.3000 region. Loss of this zone is needed to re-target the 1.2755/40 July and April lows," CB adds.
Copyright © 2013 eFXnews
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