Our last London session analysis:
Friday consumer sentiment from USD was another large positive number.
Over the weekend, the PPI from JPY was in line with expectation and slightly better than previous.
Today was another quiet session with no tier one datas in London and NY session.
Sentimentally, Asia equity markets were largely green to signal another risk on sentiment day.
WTI is currently surging higher at $54 with OPEC & Non-OPEC producers on Sat reached their first deal since 2001 to curtail oil output jointly.
-FED futures show 97% probability of rate hike in this Wed; another very positive sentiment for USD. The only risk is how far we can go before a large correction or a surprise rate unchanged for a large drop in USD - very unlikely.
-JGB bond price tumbled on Monday as investors sold bonds for stock markets and USD; another negative sentiment for JPY.
-Most Eurozone yield fall on QE relief, Italian bank continues to face troubles and EURO in general is in negative area fundamentally and sentimentally.
-AUD & NZD continued to be pressure due to large buying into USD
-GBP has no major news and still moves around Brexit and High Court decision
-CHF is in the same spot as JPY
In this session, we continue to be bullish in USD as FED rate hike is almost 100% now, although there will be retracement here and there, but most likely USD will keep going up all the way until the FED decision comes out - which then the market will correct as buying rumour and selling fact effect.
We’re also bullish in CAD as the new deal by OPEC & Non OPEC members will continue to support oil market and CAD.
We are bearish in EUR as QE announcement from last week was relatively negative and the surging of USD and selling of EURO bonds also play effect to negative EUR.
We are also bearish in JPY & CHF as both currencies are still weaken internally and externally especially in this risk on sentiment environment.
We will stay out of AUD & NZD as they’re strong economically but the current dollar strength has played a negative sentiment for them.
We will stay out of GBP as we don’t know have a clear direction for now, but as soon as there is any news from High court, we will buy it against EUR, JPY & CHF.
Today’s Daily Analysis Dec 12th
Today is another quiet Monday as usual, furthermore, the market is all geared up for the Wed FED meeting as this is the biggest event of this week.
Because of the light economic datas and current sentiment driven market, our focus is still on the market sentiment and we’re still bullish on the same currencies and bearish on the same ones.
Equity markets had a little bit correction today with some reds, and WTI closed up again due to the weekend’s meeting - however, the daily candlestick was trying to close above $55 but failed - signalled another doubt over OPEC’s ability to control oil market.
The point is, there are always many reasons to guess a price action so let’s just focus on the real fact - the dollar is strong fundamentally, and the current sentiment has been risk on and in favour of USD. So we will continue to be bullish and buy at dip for USD.
The general direction for CAD is to keep edging higher as long as oil market continues to do so - and it will, but as mentioned, for how long and how much, that is a question market as we also have a question market for OPEC’s real ability to curb oil output for long-term.
Generally speaking, it’s still best to watch out demands from China and U.S to guess where the oil price is going.
EUR is a more reactive currency for now, as it’s directionless by its won but will either be sold or bought when USD is up or down.
We’re still waiting for High Court ruling and/or any comments or rumours in regards to the decisions. That will most likely be the main driver.
Take a look at this week’s economic calendar at Forexfactory.com
Currently our view is still the same, buy USD, CAD, AUD & NZD and sell EUR, CHF & JPY
Buy GBP against EUR, CHF & JPY and sell GBP against USD, CAD, AUD & NZD
Cot base futures position for Dec 12th 2016
AUD + 20,000
GBP - 75,000
CAD - 20,000
EUR - 100,000
JPY - 40,000
CHF - 20,000
USD + 40,000
NZD - 5000
Our last London session analysis:
Friday consumer sentiment from USD was another large positive number.
Over the weekend, the PPI from JPY was in line with expectation and slightly better than previous.
Today was another quiet session with no tier one datas in London and NY session.
Sentimentally, Asia equity markets were largely green to signal another risk on sentiment day.
WTI is currently surging higher at $54 with OPEC & Non-OPEC producers on Sat reached their first deal since 2001 to curtail oil output jointly.
-FED futures show 97% probability of rate hike in this Wed; another very positive sentiment for USD. The only risk is how far we can go before a large correction or a surprise rate unchanged for a large drop in USD - very unlikely.
-JGB bond price tumbled on Monday as investors sold bonds for stock markets and USD; another negative sentiment for JPY.
-Most Eurozone yield fall on QE relief, Italian bank continues to face troubles and EURO in general is in negative area fundamentally and sentimentally.
-AUD & NZD continued to be pressure due to large buying into USD
-GBP has no major news and still moves around Brexit and High Court decision
-CHF is in the same spot as JPY
In this session, we continue to be bullish in USD as FED rate hike is almost 100% now, although there will be retracement here and there, but most likely USD will keep going up all the way until the FED decision comes out - which then the market will correct as buying rumour and selling fact effect.
We’re also bullish in CAD as the new deal by OPEC & Non OPEC members will continue to support oil market and CAD.
We are bearish in EUR as QE announcement from last week was relatively negative and the surging of USD and selling of EURO bonds also play effect to negative EUR.
We are also bearish in JPY & CHF as both currencies are still weaken internally and externally especially in this risk on sentiment environment.
We will stay out of AUD & NZD as they’re strong economically but the current dollar strength has played a negative sentiment for them.
We will stay out of GBP as we don’t know have a clear direction for now, but as soon as there is any news from High court, we will buy it against EUR, JPY & CHF.
Today’s Daily Analysis Dec 12th
Today is another quiet Monday as usual, furthermore, the market is all geared up for the Wed FED meeting as this is the biggest event of this week.
Because of the light economic datas and current sentiment driven market, our focus is still on the market sentiment and we’re still bullish on the same currencies and bearish on the same ones.
Equity markets had a little bit correction today with some reds, and WTI closed up again due to the weekend’s meeting - however, the daily candlestick was trying to close above $55 but failed - signalled another doubt over OPEC’s ability to control oil market.
- USD once again is the strongest currency both fundamentally & sentimentally, however, we had large retracement today and it could be following reasons: market is worried for the FED comments on the future of dollar, especially too strong of a currency can hurt U.S upcoming focus on export. It could also very well be hedge fund pressuring the price down to ideal levels to buy; or it can simply be profit taking.
The point is, there are always many reasons to guess a price action so let’s just focus on the real fact - the dollar is strong fundamentally, and the current sentiment has been risk on and in favour of USD. So we will continue to be bullish and buy at dip for USD.
- CAQ also continues to be supported due to the oil market and positive sentiment from OPEC.
The general direction for CAD is to keep edging higher as long as oil market continues to do so - and it will, but as mentioned, for how long and how much, that is a question market as we also have a question market for OPEC’s real ability to curb oil output for long-term.
Generally speaking, it’s still best to watch out demands from China and U.S to guess where the oil price is going.
- EUR continues to be weaken by last week’s ECB decisions and the general strength into USD & GBP, 2 counter currencies.
EUR is a more reactive currency for now, as it’s directionless by its won but will either be sold or bought when USD is up or down.
- AUD & NZD continue to be strong economically, however, we have to watch out for the dollar strength as it often pushes AUD & NZD down. The reason is because most investors buy AUD & NZD as carry trade and high yield instruments, and now if USD joins the options as high yield currency and carry trade, that will drive away the buying interest from AUD & NZD. But generally speaking, they’re both very good currencies to buy - just don’t buy against USD.
- JPY & CHF continue to be weaken due to easing environment and no safe heaven events for now.
- GBP is still neutral in our point of view, a strong currency to buy against EUR, JPY & CHF - but a weak currency to sell against USD, CAD, AUD & NZD.
We’re still waiting for High Court ruling and/or any comments or rumours in regards to the decisions. That will most likely be the main driver.
Take a look at this week’s economic calendar at Forexfactory.com
Currently our view is still the same, buy USD, CAD, AUD & NZD and sell EUR, CHF & JPY
Buy GBP against EUR, CHF & JPY and sell GBP against USD, CAD, AUD & NZD
Cot base futures position for Dec 12th 2016
AUD + 20,000
GBP - 75,000
CAD - 20,000
EUR - 100,000
JPY - 40,000
CHF - 20,000
USD + 40,000
NZD - 5000