With a negative fundamental from the US - #ISM data, #USD stalled to a decline below the 95.05/10 levels again. This reflected the sudden burst of liquidation from speculative bulls on the USD that prompted a lift as a catalyst for #CABLE rising above the 1.3400 even to this writing. As the late Asian trading session begins to unfold for a shift back towards Japanese #YEN strength trading at 101.40 (#USDJPY) levels for the third time since May 2016 alone.
CABLE - GBPUSD
Link: https://dwq4do82y8xi7.cloudfront.net/x/o0rQSrTA/
USDJPY Overlay DXY (PC)
Link: https://dwq4do82y8xi7.cloudfront.net/x/KHwwIRUD/
AUSSIE DOLLAR
Link: https://dwq4do82y8xi7.cloudfront.net/x/pNMXSELH/
This has been a trading sequence of alternating trades applied which we have emphasized for the past quarter. As investor / traders that Megatrade101 continuously remind active tactical clients that such market conditions exist from time to time; that a USD decline whenever it is identified should be protected with this cross trade strategy. Alternately, #USDCHF (Swiss Franc) is another CCY pair to consider.
Likewise, the #AUSSIE (update as of 9.08.16) can accommodate such strategy even better in lieu of the fact that the commodity currency pair carries a far better carry trade swap vs the USD. Alternative Crosses are viable choices whenever swap rates are discussed.
For now, considering the USD decline, expect a more positive lift for European majors and Asian currencies to benefit from a declining USD.
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For now the immediate price reaction is seen across the board. For how long this can be sustained will be the next question to ask.
ReplyDeleteSustainability of a price recovery would still be in question whenever the lack of firm volume conviction remains low. This can only be identified with an increase in price momentum for a follow through. In its absence, recovery may well be limited and short-lived.
ReplyDeleteAUSSIE Dollar has indeed reacted well now trading in late Asian session above 0.7700 Link: https://dwq4do82y8xi7.cloudfront.net/x/ZGDygiNx/
ReplyDeleteIndeed, European markets are down, yet European currencies and two of the major Asian currency pairs; #AUSSIE & #YEN simply offsets the lackluster trading in the US stock market. Alternating market shift from tactical investors have done well in this type of market condition.
ReplyDeleteLink: http://ukinvestormagazine.co.uk/markets-eg235y/