Another week, another weekly overview. Lets dive in.
USD
Dollar got sold off last week and we were looking for a risk off scenario. We got it in some intraday positions in GBP/USD and EUR/USD but it was not very clear direction. With the escalation over the weekend in the Middle East, we could see that run for the world reserve currency and get some inflows into USD at the start of this week. We have packed data this week with Non Farm Payrolls coming out Friday so be very careful with this release.
Euro
Eurozone data came in hot last week with inflation cooling and that giving weakness in euro. Expect this weakness to continue because there is nothing positive going on for euro.
Pound
Pound had some positive growth data but its not out of the woods, its not running far behind euro. Pound got sold last week and you can see that in EUR/GBP and GBP/JPY. So look to sell any rallies in those respective pairs and pound in general.
Aud
With the recent escalation in the middle east, commodities can have that safe haven run which will bring aussie through the roof. Expect some inflows in AUD this week. Do not forget RBA interest rate decision which is set to pause at 4.35% which can bring some outflows in AUD. It will be very volatile week so I will stay out of AUD pairs
Cad
Canadian dollar can get some buying opportunities after OPEC cut production for additional million barrels a day. Do not forget the Canada Interest Rate decision on Wednesdey, they are set to pause rates at 5%
JPY
The samurai’s are still quiet. Their data gives some positivity and we saw that last week, but that was nothing to do with strong yen but everything to do with weak dollar. If the weak dollar narrative continues we can see further strength into the yen, however with the escalation in the MIddle east I would not touch the Yen pairs this week.
Our top picks:
Our bias remains. That is EUR/USD shorts and EUR/CAD shorts.
EUR/USD
Nothing changes for this pair, eurozone is struggling and any little rally in dollar we can get we can jump on the back of it now. 1.09600 is a good price area for shorts on this one
EUR/CAD
Again, eurozone is struggling and on the other hand we have CAD with Oil pumping after that OPEC production cuts. 1.48500 is a good price area for shorts on this one
Please note that this is only our opinion and you shouldn’t take it as investment advice. Make your own analysis and do your own research on the markets before execution. Remember that your capital is at risk and it is fully your responsibility to manage your own risk.
Our opinions and biases are for educational purposes only.