Major Bank Daily Position
USD/JPY - UOB -
SHORT Limit Order - Placed - Entry: 109.95, Target: 108.70, Stop: 110.50 (S/T)
AUD/USD - UOB -
LONG Limit Order - Placed - Entry: 0.7515, Target: 0.7615, Stop: 0.7455 (S/T)
EUR/AUD - Crédit
Agricole - SHORT Position - From 1.5095 - Adjusted - Stop from 1.5320 to
1.5230, Target: unch. (M/T)
USD/JPY - UOB -
SHORT Limit Order - Filled - Entry: 109.95 - Target: 108.70, Stop: 110.50 (S/T)
Barclays
Barclays argues thyat ECB risks are skewed towards a dovish
statement on Thursday, but a more hawkish statement would be disruptive.
“A change in ECB forward guidance or risk assessment is
widely anticipated at its Thursday meeting. While this suggests an unchanged
statement would likely weigh on the EUR and support a rally in European equity
and fixed income asset prices, a more hawkish statement in line with our
economists expectation of a removal of the reference to lower rates along with
other adjustments may do the opposite.
On balance, risks to market expectations appear skewed to
only a slight reduction of policy accommodation given actual and expected
inflation trends and the experienced of other major central banks in more
cyclically advanced economies.
BTMU
BTMU notes that most G10 currency pairs have already
completely reversed the Trump move, with the exception of USD/JPY remains the
one pair that is notably above the pre-Trump election.
“While we don’t see grounds for a complete reversal of the
10 y UST bond y move, the near term risks remains to the downside leaving
USD/JPY vulnerable after breaking key 110 level.
“Given our broader dollar bear view, we assume USD/JPY will
gradually decline reflecting primarily dollar weakness. The TWI strength for
the yen will be more limited initially although further out global risks in
relation to Trump expectations and European politics point to outright yen
appreciation.
BofAML
BofAML outlines 4 main scenarios for the UK elections on
Thursday and the potential GBP direction for each of them.
1.
Large Conservative victory (market consensus):
With market nerves having increased in the
final weeks of the campaigh, we believe a large Conservative victory would be
initially bullish for GBP. Our bias would be to sell GBP rallies.
2.
Small Conservative victory:
“Relative to market expectations, this
would be seen as disappointing for GBp and though there would be some initial
relief, we believe this would prove very short lived,” BofAML adds.
3.
Labour-led coalition:
“A hung parliament with a Labour –led coalition
as the only viable option would be initially be negative for GBP in our view. We
believe markets will focus on the implication of such a coalition through the
Brexit lens. Any dips in GBP may be seen as a buying opportunities.
4.
Labour majority
We think the initial reaction is likely a
steep decline and GBP weakness could persist for longer as markets digest the
full implication of Labour’s macro policies.
SocGen
SocGen notes that ECB meeting could sees nothing but
platitudes and disappoint a market that is getting ahead of itself.
But that would be a huge euro buying opportunity, because
ECB normalization is coming.
And when it does, the Euro won’t be able to sustain
undervalued levels for long.
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