Forex Insider Daily Update 14 June 2017

Major Bank Daily Position

USD/CAD - Citi - SHORT Position - From 1.3450 - Adjusted - Stop from 1.3600 to 1.3350, Target: unch. (TOTW-M/T)

USD/CAD - Citi - SHORT Position - From 1.3450 - Closed at market at 1.3235 (TOTW-M/T) +215 pips

USD/CAD - TD Bank - SHORT Position - From 1.3700 - Adjusted - Stop from 1.3600 to 1.3250, Target: unch. (M/T)

AUD/USD - Morgan Stanley - SHORT Position - From 0.7540 - Stopped out at 0.7570 (M/T) -30 pips

USD/CAD - TD Bank - SHORT Position - From 1.3700 - Hit Target at 1.3200 (M/T) +500 pips

CACIB

CACIB notes over the past year, every week that the BOJ and FOMC have had meetings in the same week, the JPY strengthened.  

However, CACIB argues that as the market is already priced for a dovish hike from FOMC, this reduces the risk of a repeat of history and could lead to a relief rally in USD/JPYpost the FOMC meeting.

Nonetheless, CACIB also notes that there are reports that the BOJ is considering changing its communications to acknowledge that it is thinking about how to handle a future exit from monetary stimulus, without giving the impression that this is on the agenda anytime soon.

Our economist think that this week’s BOJ monetary policy is not likely the right place for outlining an exit strategy, however “A data dependent Fed should wait at least one meeting to confirm to confirm that recent weakness is only temporary. However, that meetings in the October or December, when the Boj issues it’s Outlook Report, would be more likely forum for such an announcement.

Danske

Danske sees the Fed skipping hiking at tomorrow’s meeting and instead announcing the triggers for Quantitative tightening (QT).

However, danske argues that such an outcome should be USD positive and it should lead the start of a correction in EUR/USD over the summer.

“For EUR/USD, a hawkish stance from the Fed would come at a time where the ECB has admittedly moved a tad closer to neutral on rates but at the same time laid out an inflation outlook that deters Draghi and co from looking for an easing exit anytime soon. IN our view, this makes the period where EUR/USD could move to the lower end of its newfound 1.08 – 1.13 range.

Should Fed refrain from hiking in June, the knee-jerk reaction will most likely send EUR/USD higher but we do not expect a level above 1.13. However, in our base case that a summer hike will come if not June, July. We think as markets digest the boldness with which we think the FOMC will move near term, USD strength will materialize for a while.

In line with this view, Danske remains tactically short EUR/USD targeting 1.09 3M but sees level below 1.1 atrractive for positioning for a renewed uptick towards the end of the year.

NAB

NAB expects a quarter point lift to the Fed Funds rate at the FOMC June meeting and argues that any thing other than retention of the end 2017 median dot at 1.375% would be a major surprise.

If no upsets here, then what if anything happens to the 2018 dots and the narrative surrounding them in Yellen’s post FOMC press conference should be important.

If the Fed highlights that the medium term outlook for inflation or rates has not really changed despite recent softer data, there is potential for the USD to rally out of the FOMC.

However, NAB argues that a substantial USD rally will likely require string US data over the coming months.

We continue to expect this, hence our bullish USD H2 2017 forecasts, for all bar EUR/USD.

CIBC

CIBC notes that EUR/USD fair model is estimated around 1.29 and expects to see the exchange rate reach 1.17 by year end.

“Over that time, look for ECB hawks to keep pounding the table and the doves to have less reason to pump stimulus into the system.

Furthermore, the Eurozone’s large table surplus will provide a tailwind to the currency at a time when a detiorating trade balance from the US is doing the exact opposite to the greenback.

CIBC targets EUR/USD at 1.14, 1.16, and 1.17 by end of Q2,Q3 and Q4 of 2017.

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Shin Daily US Stock Review 13 June 2017

Shin Daily US Stock Position

ENZ - LONG Position - Opened - From: 10.35$ - Stopped out at 9.83$ (S/T) -0.52$ (5,02%)

CLNT - LONG Position - Opened - Entry: 4.75$, Target: 10.83$, Stop:4.07$ (S/T)

CLNT - CLEANTECH SOLUTIONS INTERNATIONAL INC

Cleantech Solutions, through its affiliated companies, designs, manufactures and distributes a line of proprietary high and low temperature dyeing and finishing machinery to the textile industry. 

ENZ - Fundamental Insight

WUXI, China, June 12, 2017 /PRNewswire/ -- Cleantech Solutions International, Inc. ("Cleantech Solutions" or "the Company") (CLNT) today announced that it has entered into exclusive discussions with ECrent Capital Holdings Limited ("ECrent"), a private company incorporated in British Virgin Islands focusing on developing and operating of a global rental platform to promote sharing economy across 30 countries and regions.

The Company's board of directors plans to form a special committee consisting of independent directors to evaluate and negotiate, on behalf of the Company, the potential acquisition and/or business cooperation transaction(s) with ECrent. The special committee is also expected to engage independent financial and other advisors in connection with such potential transactions. The exclusive period is initially set for three months and may be extended by both parties.

About ECrent Capital Holdings Limited

Ecrent Capital Holdings Limited operates ECrent platforms and local business operations across 30 countries and regions, including Greater China, Taiwan, Canada, Brazil, Argentina, Mexico, Thailand, India, Indonesia, Singapore, Malaysia, Philippines, Vietnam, Cambodia, Japan, Korea, Australia, New Zealand, United Kingdom, Germany, France, Poland, Switzerland, Netherlands, Denmark, Russia, Italy, Spain, Portugal, Greece. ECrent promotes sharing economy through rent to reduce environmental damages caused by excessive consumption.

"In the first quarter of 2017, we saw a slight uptick in revenue as some of our customers who had temporarily ceased operations to comply with stricter environmental requirements last year resumed normal operations. Although higher raw material costs impacted margin and contributed to the slight loss for the quarter, we generated positive cash flow from operations and improved our cash position from the end of 2016," said Mr. Jianhua Wu, Chairman and CEO of Cleantech Solutions. "We expect our revenues to remain relatively stable in the near future and are focused on improving the long-term outlook for our business. We continue to develop our next generation dyeing and finishing equipment based on the patented ozone-ultrasonic technology.  We remain excited about our investment in Shengxin, a newly formed company that plans to build solar farms in Guizhou and Yunnan provinces, and are exploring opportunities to produce precision components for other high growth industries."

First Quarter 2017 Results

Revenue for the first quarter of 2017 increased by 2.9% to $4,658,000, compared to $4,527,000 for the same period in 2016. The Company's only source of revenue is from the dyeing and finishing business, since the forged rolled rings and related products and petroleum and chemical equipment businesses are discontinued.  In the first quarter of 2016, some of the Company's customers temporarily ceased operations to comply with stricter environmental requirements, resulting in fewer orders for dyeing machines from these customers.  In first quarter of 2017, these customers restored normal operations, resulting in a slight increase in revenues in the quarter.

Gross profit for the first quarter of 2017 was $586,000, compared to gross profit of $821,000 for the same period in 2016. Gross margin was 12.6% during the first quarter of 2017 compared to 18.1% for the same period in 2016. The decline in gross margin was primarily attributable to higher raw material costs.

Operating expenses decreased by 12.3% to $682,000, compared to $778,000 for the same period in 2016.  The decrease was primarily due to a reduction of stock-based consulting fees, which was partially offset by an increase in research and development expenses for the development of new dyeing and finishing products. 

Loss from operations was $96,000, compared to income from operations of $43,000 for the same period in 2016.

Loss from continuing operations was $146,000, or $(0.10) per basic and diluted share, compared to loss from continuing operations of $103,000, or $(0.10) per basic and diluted share for the same period in 2016.

Loss from discontinued operations (Refer to "Discontinued Operations" discussion below) was nil for the first quarter of 2017. This compares to loss from discontinued operations of $741,000, or $(0.72) per basic and diluted share for the first quarter of 2016.

Net loss for the first quarter of 2017 was $146,000, or $(0.10) per basic and diluted share, compared to net loss of $844,000, or $(0.82) per basic and diluted share, for the same period in 2016.   

Basic and diluted earnings per share were based on 1,415,441 and 1,025,172 weighted average shares outstanding, respectively, for the three months ended March 31, 2017 and 2016. All share and per share information has been adjusted to reflect a 1-for-4 reverse stock split effective March 20, 2017.

Financial Condition

As of March 31, 2017, Cleantech Solutions held cash and cash equivalents of $2,829,000 compared to $1,481,000 at December 31, 2016. Accounts receivable were $15,397,000 compared to $13,922,000 at December 31, 2016. Inventories were $2,795,000 compared to $2,394,000 at December 31, 2016. The Company had $2,176,000 and $638,000 in short-term bank loans and bank acceptance notes payable, respectively, at March 31, 2017, up from $2,160,000 and $547,000, respectively, at December 31, 2016. Working capital was $22,621,000 at March 31, 2017 compared to $21,539,000 at December 31, 2016. Stockholders' equity was $65,662,000 at March 31, 2017 compared to $65,312,000 at December 31, 2016. 

In the first quarter of 2017, the Company generated $1,338,000 in operating cash flow, primarily due to increases in accounts payable and advances from customers which were offset by increases in accounts receivable, advances to suppliers and inventory and the net loss for the period. 

Discontinued Operations

On December 30, 2016, the Company sold 100% of the stock of Wuxi Fulland Wind Energy Equipment Co., Ltd. ("Fulland Wind") to an unrelated party and discontinued the Company's forged rolled rings and related components business. Additionally, the Company's management decided to discontinue its petroleum and chemical equipment segment due to significant declines in revenues and the loss of its major customer. As such, the assets and liabilities of these two segments were classified on the unaudited condensed consolidated balance sheets as assets and liabilities of discontinued operations as of March 31, 2017 and December 31, 2016 and the operating results were classified as discontinued operations in the unaudited condensed consolidated statements of operations for the three months ended March 31, 2016.

ENZ - Technical Insight

Market movement shows it's Huge volume break this week supported by it's latest repetition of descending movement and flag pattern, a good stock to pick, maintain buy position for now

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Forex Insider Daily Update 13 June 2017

Major Bank Daily Position

AUD/USD - UOB - LONG Limit Order - Canceled - Entry: 0.7515, Target: 0.7615, Stop: 0.7495 (S/T)

GBP/USD - UOB - SHORT Limit Order - Placed - Entry: 1.2735, Target: 1.2560, Stop: 1.2820 (S/T)

AUD/NZD - Société Générale - LONG Position - Opened - Entry: 1.0460, Target: 1.0900

EUR/USD - Nomura - LONG Position - From 1.0845 - Adjusted - Stop from 1.1000 to 1.1100, Target: unch.

GBP/USD - UOB - SHORT Limit Order - Filled - Entry: 1.2735 - Target: 1.2560, Stop: 1.2820 (S/T)

Danske

Danske sticks to its view that the Fed will skip hiking at the upcoming meeting and instead announce the triggers for Quantitative Tightening

“A data dependent Fed should wait at least one meeting to confirm to confirm that recent weakness is only temporary. However, given the high expectations of a June hike, the Fed may have painted itself into a corner, as high expectations have weighed on the Fed’s decision before.

If the Fed hikes in June, we do not expect an announcement on QT, we expect it to be postponed until September meeting. We still think the third rate hike most likely in December.

We expect unchanged “dots” signaling 3 hikes per year and see limited chance of a hawkish surprise,”

On the USD front, Danske argues that if Fed presents something along those lines, the USD could see a boost on the back of the start of an unwarranted tightening of USD liquidity over the coming 3-12M depending on the timing of the start of the reduction.

BTMU

“USD/CAD has broken below key support from its 200 day moving at around 1.3335 level which has reinforced bullish momentum for the Canadian dollar in the near term,” BTMU adds.

“The development support our bullish outlook for the Canadian dollar which in part was build on the assumption that BoC would begin to raise rates in the first half of next year.

If expectations for policy divergence between the BoC and Fed become less acute, USD/CAD should move closer into line with levels justified by the price of crude oil which we estimate is currently between 1.25 and 1.3

BofAML

FOMC hike seems very likely, with the market now pricing it fully.

The focus will be on the tone and any signals for the pace of hikes in the rest of the year and next year. Following mixed recent data, we believe that markets already expect a dovish hike next week.

Still, if the dot plot also changes to reflect fewer hikes, the USD could weaken further.

TD

TD notes that USD/CAD marked its biggest 1 day move in nearly 3 months, dropping over 1% in reaction to BoC wilkins comments yesterday which clearly caught markets off guard, as shw cited several improving fronts regarding the Canadian economy.

“Most importantly she concluded her remakrs asking whether the considerable monetary stimulus was still needed to archieve the Bank’s policy mandate. These comments dove tail with the recent shifts in the BOC’s tone. Indeed, her speech emphasized the sustainability of the recovery, which comes on the heels of the stellar May jobs report,”

“Overall, this increases the upside risks to our BoC call, with increasing odds for a hike as early as Octover this year and a break below 1.3 in Q4,”

TD maintains a short USD/CAD position from 1.37 targetting a move to 1.32

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Forex Insider Daily Update 12 June 2017

Major Bank Daily Position

AUD/USD - UOB - LONG Limit Order - Adjusted - Stop from 0.7470 to 0.7495, Entry: unch., Target: unch. (S/T)

USD/CAD - Citi - SHORT Limit Order - Placed - Entry: 1.3450, Target: 1.3150, Stop: 1.3600 (TOTW-M/T)

USD/CAD - Citi - SHORT Limit Order - Filled - Entry: 1.3450 - Target: 1.3150, Stop: 1.3600 (TOTW-M/T)

Barclays

Barclays expects the Fed to raise the target range for the federal funds rate by 25BP to 1.00 – 1.25% at its June meeting this week.

Although some details may be lacking, we expect the message on balance sheet policy to be clear, consensus has been reached and runoff is likely to begin soon.

Given our expectation of a rate hike in June and balance sheet run off in September, we find it unlikely that the Fed will deliver a dovish message on the outlook.

Trade Of The Week: Short USD/INR

“We recommend short USDINR NDF targeting 64.15 (ref1m NDF:64.6, SL 64.8). INR is one of our favourite carry currencies, supported by positive investor sentiment, on going reforms, improving trade data and low volatility. We do not expect any upset to risk sentiment by Fed this week, which should bode well for high yielders.

“A less hawkish RBI, improving trade data and no upsets to risk sentiment by the Fed should support INR, while we think market is underestimating the likelihood of a 50bp cut in Russia.

SocGen

EUR/USD has taken hape at the down slanting channel support at 1.035

“The pattern’s validation level stands at 1.086/1.08 which also coincides with multiyear graphical levels.

Thus, EUR/USD looks poised to head higher initially towards the down channel’s upper band at 1.146, also the 2015/2016 highs and 23.6% retracement of the down move since 2011 peak.

It is then set to move towards 1.1685/1.1714, the August 2015 high and the 23.6% retracement of the entire cycle. Graphical levels at 1.1875/1.2043 will represent a key hurdle ahead.

CIBC

CIBC notes that while EUR has rallied this year, it didn’t get any help on that path from the ECB this week.

“While policy makers are no longer suggesting rates could be cut again, there weren’t any signals towards tapering QE later in the year or rate increase in 2018. However, we still see the EU economy progressing well, which will enable a reduction of stimulus later this year or early 2018,” CIBC adds.

“As such the recent pullback in EURUSD should reflect better values for long positions to be reestablished, as we see it rising to 1.18 by end 2018.

BNPP

Trade Of The Week

We recommend to short AUDUSD because we think USD could rally this week as markets will refocus on Q2 economic data and medium term picture.

Our economists think the language on the balance sheet is likely to change at the Fedmeeting, setting up a formal balance sheet reduction announcement in September.

Citi

Trade Of The Week

Citi recommends selling USD/CAD around 1.345 targetting 1.315 with a stop at 1.36

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Forex Insider Daily Update 11 June 2017

Major Bank Daily Position

EUR/GBP - Deutsche Bank - LONG Position - From 0.8608 - Hit Target at 0.8850 (M/T) +242 pips

EUR/GBP - Barclays - SHORT Position - From 0.8710 - Stopped out at 0.8854 (M/T) -144 pips

USD/JPY - Citi - SHORT Position - From 110.45 - Closed at 110.45 (TOTW-M/T) ±0 pips

EUR/AUD - Crédit Agricole - SHORT Position - From 1.5095 - Closed at market at 1.4835 (M/T)+260 pips

USD/JPY - UOB - SHORT Position - From 109.95 - Stopped out at 110.50 (S/T) -55 pips

EUR/USD - Danske - SHORT Stop Order - Filled - Entry: 1.1167 - Target: 1.0850, Stop: 1.1350 (M/T)

EUR/JPY - BNP Paribas - SHORT Limit Order - Canceled - Entry: 125.00, Target: 120.00, Stop: 127.00 (M/T)

Morgan Stanley

For EUR/USD in particular, MS expects a tactical correction lower and maintains its buy on dips at 1.103 targetting 1.18.

“We have turned tactically bullish on USD. We see negative sentiment and short positioning as extreme and a modest increase in the outlook could result in a significant USD appreciation. The weaker than expected payroll report on Friday is still good enough to enable the FOMC to raise rates next week.

Given our expectation for a tactical USD rebound, EUR bullish sentiment nearing extremes and speculative investors being most long EUR since the Eurozone debt crisis in May2011, we see potential for EURUSD to correct lower in the near term which we view as a buying opportunity.

TD

GBP direction in the aftermath of the UK elections noticing that the focus will shift now to the Brexit talks which set to begin in just 10 days.

“The neat term outlook for GBP is likewise clouded by the recent developments. The upside is that SNP’s loss of support reduces the odds of a Scot referendum.

However, the next few weeks will likely to see 2 way risks intensify but with a bias to trade lower.

CACIB

We remain bearish GBP in the near term also given that the election outcome will likely underpin the cautious outlook of the BOE next week,” CACIB argues.

On the EUR front, CACIB notes that the focus will be on the first round of the French legislative election on Sunday.

“That said, the ECB has signaled it is in no hurry to unwind its monetary stimulus so long as inflation remains firmly below its target. This could keep EUR grounded for now.

On the USD front, CACIB notes that investors will focus on FOMC meeting.

The Fed should hike rates but keep its forward guidance noncommittal about future rate move given the softer inflation data of late. Investors will look for more clarirty on the timing of reduction of the Fed’s balance sheet. Indications that a decision could come as soon as September could boost UST yields and USD.

On the JPY front, CACIB notes that BOJ meeting next week could attract more attention than usual given recent reports suggesting that the bank would conduct simulations to assess the impact of a potential QE exit.

BofAML

Investors went into the meeting with a relatively light position in our view, looking for an opportunity to buy any EUR dip. We have to wait for this fall to get the details on the future of QE after this year.

Pools suggest an easy win absolute majority for Macron in France next week. Such a victory would give more political capital to Macron, helping him to reform France and argue for broader EU reforms post QE with the winner of the German elections this fall. On balance, positive for the EUR.

All in all,BofAML expects mixed outlook for EUR/USD but recommends long EUR/GBP and is looking for the right opportunity to long EUR/JPY.

NAB

GBP outlook from here is especially confused and the only thing we can be sure of it the enormous uncertainity over the near term.

For the moment, the extent of the GBP’s decline has been limited by the belief that Mrs May will be able to carry on as OM but will be forced to change her stance on the terms of Britain’s exit from EU.

If either of these judgements prove to be wrong, then the pound is likely to fall further in the near term, especially if it were felt that another General election might then have to be called.

We will attempt a formal set of forecast revisions in the early part of the next week.

SocGen

It has now bounced off 73, some 4% below current levels, 3 times since 1992 in Feb 1993, Dec 2008 and Oct 2016.

We will probably test that level again this summer. That is likely to take GBP/USD to 1.25 but not to 1.2 and EUR/GBP above 0.9 but things have to get even worse before we can ponder levels above 0.95.

In the longer run, what drives the pound will be relative economic performance and policy. A minority gov can’t do the kind of damage to the economy a misguided one could do, but as growth slows, the MPC will remain on hold and as others raise rates. The contrast between MPC and Fed or ECB may not be stark enough to trigger a sterling collapse from here but will anchor it around these long term historical lows. 

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Shin Daily US Stock Review 10 June 2017

Shin Daily US Stock Position

ALXN - SHORT Position -  From 106.67$ -  Stopped out at 101.26$ (S/T) +5.41$ (5,07%)

KOS - SHORT Position - From 7.33$ - Closed at 6.12$ (S/T) +1.21$ (16,5%)

ZOES - SHORT Position - From 12.98$ - Stopped out at 14.16$ (S/T) -1.18$ (9,09%)

EXAS - LONG Position - From 36.47$ - Stopped out at 34.94$ (S/T) - 1.53$ (4,2%)

ENZ - LONG Position - Opened - Entry: 10.35$, Target: 13.92$, Stop: 9.83$

ENZ - ENZO BIOCHEM

Enzo Biochem is a pioneer in molecular diagnostics, leading the convergence of clinical laboratories, life sciences and intellectual property through the development of unique diagnostic platform technologies that provide numerous advantages over previous standards. A global company, Enzo Biochem utilizes cross-functional teams to develop and deploy products, systems and services that meet the ever-changing and rapidly growing needs of health care today and into the future. Underpinning Enzo Biochem’s products and technologies is a broad and deep intellectual property portfolio, with patent coverage across a number of key enabling technologies.

ENZ - Fundamental Insight

Third Quarter Highlights

• Total revenues increased to $27.1 million, a 2% increase from $26.4 million in the prior year period.
• Clinical Labs revenues totaled $19.6 million, an 8% increase over the prior year period and the sixth straight quarterly increase, reflecting continued growth in volume of high margin molecular diagnostic tests (MDx). Gross margins advanced 300 basis points, to 42%.
• Consolidated gross margin was 45%, a 200 basis points improvement over the prior year period.
• With operating expenses lower, including legal costs, Enzo recorded a GAAP loss of $71,000, or $0.00 per share. EBITDA, a non-GAAP measure, was $0.7 million, a $1.8 million improvement over the prior year period.
• Enzo Life Sciences’ revenue was $7.5 million, an 9% decline from $8.3 million in the prior year period. This was due to timing of product shipments, continued reduction in the product mix to emphasize higher margins, and industrywide weakness in the academic and governmental markets. Despite reduced revenues, the segment remained profitable and cash flow positive.
• Consolidated cash flows from operations in the quarter were $0.9 million. After investing $0.7 million in capital expenditures related to expansion in the Clinical Labs, total cash and cash equivalents increased $0.2 million over the second fiscal quarter 2017. Working capital at April 30, 2017 was in excess of $70.5 million.
• As previously announced, New York State Department of Health’s recent conditional approval of three new diagnostics for the company’s cost efficient AmpiProbe® PCR platform paves the way for their additions to Enzo’s expected specialized 14-analyte panel, anticipated to be available by fall, that will further establish Enzo’s strong MDx position in women’s health.

Barry Weiner, President, Comments:

“This was another excellent quarter of operational performance, one of sustained growth, technological advances and market inroads. Our transformative strategy to a fully integrated molecular diagnostic company is being recognized in the marketplace. The quarter was notable for the steadily increasing performance of our clinical services. It reflected the addition of new clients, growing interest in our molecular diagnostic development capabilities, and expanding national reference services giving recognition of our leading position as a provider of comprehensive women’s health diagnostics. Enzo Life Sciences was affected by timing of certain U.S. shipments, and tightening of academic and government spending, while the segment focuses on product development and approvals. In a relatively short time, we have streamlined its product mix to concentrate on higher margin products and have reduced products by over one-third to free capacity for molecular diagnostics manufacturing and distribution. At the same time, Enzo Life Science’s research capabilities, uniquely integrated with our Clinical Labs, continues to turn out advanced genomic diagnostic products built around our proprietary technology platforms. This has enabled gross margin expansion at Enzo and broadens our MDx test menu that offers greater efficiency and reduced costs to independent laboratory customers.

“The integration of our operations is proving an important aspect of our activities. We have been able to build a formidable business model employing our significant patent estate and years of accumulated know-how to benefit today’s independent lab market. Specifically, we now provide a growing menu of highly efficient, versatile and cost effective MDx products and platforms, compatible with current open systems, which could result in significant savings -- in many cases between 30% to 50%. We also have gone a step further by making our state-of-the-art lab capabilities available on a reference basis, enabling many independent labs to utilize our services to continue to respond to their client-physician needs and maintain margins as one effective way for dealing with high product costs and shrinking reimbursements.

“Also, Enzo was recently designated as an in-network health care provider in the U.S. by one of the nation’s leading health services organizations. Expanding Enzo’s in-network insurance coverage nationwide is a key component of our growth strategy.

“Lastly, our patent infringement related lawsuits are moving through the court system in Delaware and we expect some trials may get underway before the end of the year.”

ENZ - Technical Insight

Market movement shows it's price break the last 10 year new high territory with huge volume increase, it's a good signal that it will continue it's uptrend, supported by it's latest repetition of descending movement pattern after breakout, definetly a good stock to pick, maintain buy position for now

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Forex Insider Daily Update 9 June 2017

Major Bank Daily Position

USD/JPY - Citi - SHORT Position - From 110.45 - Adjusted - Stop from 111.70 to 110.45, Target: unch. (TOTW-M/T)

EUR/AUD - Crédit Agricole - SHORT Position - From 1.5095 - Adjusted - Stop from 1.5230 to 1.5040, Target: unch. (M/T)

USD/JPY - Citi - SHORT Position - From 110.45 - Adjusted - Target from 108.15 to 109.50, Stop: unch. (TOTW-M/T)

AUD/USD - UOB - LONG Limit Order - Adjusted - Stop from 0.7455 to 0.7470, Entry: unch., Target: unch. (S/T)

BTMU

BTMU holds a bullish view on NZD into year end on the ground on the following 4 reasons:

1.    The RBNZ places importance on its own Survey of Expectations which was released in May for Q2 and revealed a jump in 1 year inflation expectations from 1.56% to 1.92% and 2 year inflation expectations from 1.92% to 2.17%, the highest level since Q3 2014.

2.     Speculative positioning in NZD has undergone a rapid change from a record long position to a short position, which may well now be prone to being reversed again.

3.       Option flows also show a turn toward more positive NZD sentiment.

4.    Continued positive global growth may well prompt a shift in message from RBNZ later this year given the greater prospect of a more sustained pick up in inflation.

SocGen

SocGen notes that political distractions hinder fiscal progress in the US and political uncertainty plays its part in keeping bond yields where they are.

“An optimistic view of the ex-Director of the FBI’s testimony is that is could help reduce the uncertainty, one way or the other.

More realistically, maybe once it’s out of the way the underlying performance of the economy, which is dull rather than weak will drive markets. If that’s the case, we’d look for slightly higher yields, but not big enough move to de-rail global yield hunters.”

For now, US yields especially TIPOS, are holding lower end of rangers rather than breaking free, and we expect USD/JPY and EUR/JPY to do the same, before moving higher.

NAB

NAB notes that there were 2 key changes to the ECB policy announced today; the removal of its easing bias and upping of the balance of risks on economic growth to broadly balanced from negative.

“Together the moves confirm the ECB has started the process of very gradually pulling back from its super easy emergency policy measures put in place to deal with deflationary risks,” NAB argues.

The FOMC meeting next week will clearly be influential and especially it’s longer –term dot projections, but in the slightly bigger picture we see nothing here from ECB to tempt us away from thinking the EUR is gradually repricing to a higher range.

ABN AMRO

ABN AMRO comments on today’s ECB meeting in which the central bank changed its forward guidance, dropping the easing bias in terms of interest rates, in what is the first step in the path towards the exit from its unconventional policy.

ABN AMRO base case for the ECB going forward:

1)      A tapering of asset purchase from January 2018 onwards, with the monthly pace slowing by EUR 10 bn each month.

2)      Tapering based on limits to extending programme through 2018 given issue limits rather than the inflation outlook.

3)      We think inflationaty pressures will remain weak for sometime to come, but the ECB could sell tapering on the stronger economic recovery story.

4)      We expect the ECB to signal a tapering of asset purchases at the September 2017 meeting, when it will make further changes to its forward guidance.

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