IntelligentHQ Forex Week In Review In Association with OANDA Corporation
Report by Dean Popplewell
Dean Popplewell has a wealth of forex experience: professional currency trader for 10 years, fixed income trader for four years, and head of the global trading desks at various financial institutions in Canada. Dean is OANDA’s resident currency analyst and has been writingOANDA’s daily forex blog since January 2007 as a way to share some of his forex experience with the OANDA community.
Without either monetary or political development that can meaningfully compress sovereign spreads the odds are tipped for the EUR to test sub 1.21 sooner than we think. Peripheral markets are tighter in what optically looks like short covering. ‘Real money’ is reported to be buying the belly of the Spanish and Italian yield curve. Is it sustainable?
EUROPE Week in FX
Market to Speed up Asian Unwinding
It seems that the post EU summit euphoria has completely unwound in most equity markets, but not enough in FX. All week long analysts have been pointing out that that Asian currencies or their indexes remain somewhat firm against the USD and particularly so against the EUR than before the EU summit. China this week brought forth a few surprising data points.
Focus shift from FED to PBoC
As traders, we were told never to trade Friday the 13th. If we did, it was going to hurt. After yesterday’s short squeeze and Goldman’s revised one year EUR recommendation (1.40), the long dollar positions took it on the chin. Already this week the highly anticipated Fed minutes could not hold the line. Their lack of action or perception has only allowed the risk trading noose to tighten.
AMERICAS Week in FX
Forex Order Book
A 24-hour summary of open orders and positions
Forex Open Position Ratios