Foreign Exchange

Whilst we retain our core bearish view, a few indications point towards a corrective bounce before the dominant trend resumes. As we noted in our weekly COT report, net-short exposure on CAD futures was reduced by -23.3k contracts and gross shorts were closed at their fastest rate since July 2017. And this is after traders […]

The consensus expects RBA to cut their overnight cash rate (OCR) to a new record low of 1% tomorrow. Yet it could be down to how dovish Lowe is in his subsequent speech as to whether 70c can crash though 70c. On the 16th June Philip Lowe said it was ‘likely’ RBA would have to […]

Weekly COT Report: Traders Ditch USD For A Fourth Consecutive Week As of Tuesday 25th June: Traders reduced net-long exposure to USD for a 4th consecutive week, shedding -$1.1 billion of long positions to $19.6k billion (23.3k billion against G10 currencies) The Canadian dollar saw the largest weekly change, where net-short exposure was reduced by […]

EUR/NZD broke the March trendline following Wednesday’s RBNZ meeting. Now approaching the June low, we could see a corrective bounce towards resistance and pave the way for two bearish potential patterns we’re monitoring. Since Wednesday’s RBNZ meeting, where they held rates but were less dovish than expected, NZD crosses have retained strength. With G20 meetings […]

The meetings have kicked-off and volatility remains capped whilst traders await potentially market-moving headlines and trade developments. We take a look at a couple of JPY pairs around the event. Markets were given a gentle lift in sprits yesterday on announcement that the US and China had agreed to a trade truce ahead of the […]

A bullish outside day on the US dollar index above the March lows suggests a corrective bounce could be due. Less dovish than expected comments from Fed members Powell and Bullard helped break the dollar’s bearish streak since last week’s FOMC meeting, proving reversal candles across FX majors. Whilst the G20 could still impact the […]

RBNZ held rates at record lows of 1.5%, opting not to play catch up with RBA’s 1.25%. Yet by reintroducing talk of a cut, they kept the door open easing in August. Statement summary The Official Cash Rate (OCR) remains at 1.5 percent A lower OCR may be needed over time Domestic growth has slowed […]

GBP/AUD is making hard work on its rebound from the June low, suggesting the move is corrective. and a break lower could be on the cards whilst key resistance holds. Matt Simpson takes a technical look. GBP/AUD’s ‘rebound’ from support lacks momentum. We can see support has been found at the April and June lows […]

RBNZ hold their OCR meeting less than 24 hours away. Whilst we expect they’ll hold, we suspect they may introduce a dovish tone, given the apparent ‘race to the bottom’ seen among the Fed, ECB and RBA recently. As we noted in previous reports, RBNZ signalled a cut in March before weak inflation data all […]

With a long-term trendline broken and bears clearly back in control, the inflection point for the year has likely been seen. Just under two weeks ago, we outlined a case for USD/CAD to challenge long held views and perform a bearish reversal. At the time, it was resting precariously on its 2018 trendline, although the […]