US dollar

Outlook
Bullish
DAILY UPDATEThe US dollar is currently steady against all major currencies. Yesterday, the US dollar index (a broad measure of the currency) ended the day slightly lower after making four consecutive higher-highs earlier this week. While the buck was much weaker at the outset of the day, buyers pushed up the currency during New York trading hours. Today's US dollar index trading range remains 95.50 - 97.0.  There are no fundamentals developments driving the dollar today. After most major financial assets entered overbought or oversold conditions earlier this week, currency markets are adjusting accordingly. Looking at the US dollar, there may be an opportunity to go long the currency if the buck f...

Euro

Outlook
Bearish
DAILY UPDATEThe euro is currently steady against all major currencies. Yesterday, the euro rebounded against the US dollar after making four consecutive lower-lows earlier this week. After the euro moved into oversold territory, we have been calling for a short-term rebound. Today's EUR/USD trading range is 1.130 - 1.1530.  There are no significant fundamental developments related to the euro today. Similar to what we saw yesterday, euro trading is mostly a function of risk sentiment. As currency markets are mostly directionless today, the euro is also unchanged.  Turning to economic data, we'll see final inflation figures for the Eurozone later today. As the numbers are usually in line with th...

British pound

Outlook
Bearish
DAILY UPDATEPound sterling is currently flat against all major currencies except the Japanese yen and the euro. Yesterday, the pound moved slightly higher against the US dollar after moving into oversold territory earlier this week. Thanks to a broad rebound across all 'risk on' currencies, the pound benefited accordingly. Today's GBP/USD trading range remains 1.2660 - 1.2940. July year-over-year retail sales growth numbers both smashed expectations and accelerated relative to the previous monthly figures. Thanks to weakening base effects (at this point last year, retail sales growth was both low and decelerating), recent retail sales numbers have been fairly strong. Other economic indicators, suc...

Japanese yen

Outlook
Bearish
DAILY UPDATEThe Japanese yen is mixed today. The yen is weakening against the euro and the Australian dollar, while strengthening against the US dollar and the British pound. Yesterday, the yen weakened and fell against the US dollar. Notably, USD/JPY is running into sellers above ¥111.0 despite steadying risk sentiment. Today's USD/JPY trading range is 110.10 - 113.20. Taking a look at financial markets yesterday, risk sentiment improved following news that China's vice-commerce minister will lead a delegation to the US to revive trade talks between the two countries. The news boosted risk sentiment during the Asian trading session. Sentiment was further enhanced by solid US earnings reports, sup...

Australian dollar

Outlook
Bearish
DAILY UPDATEThe Australian dollar is currently strengthening against all major currencies except the euro. Yesterday, the aussie ended the day higher against the US dollar. Following the recent sell-off, the currency had moved into oversold territory (while the US dollar looked overbought). However, the Australian dollar's recent recovery has been fairly limited. Today's AUD/USD trading range is 0.720 - 0.7340. Yesterday, the Australian dollar was the strongest major currency. Thanks to improving risk sentiment, emerging market currencies were stronger and commodity prices were higher. This provided a welcome boost to the aussie after a big selloff in recent history.   Looking at developments i...

Canadian dollar

Outlook
Bearish
DAILY UPDATEThe Canadian dollar is currently mixed. The loonie is selling off against the euro and the Australian dollar, while strengthening against other major currencies. Yesterday, the loonie was the weakest major currency, ending the day lower against its peers. Despite a small rally in commodity prices and a softer US dollar, the Canadian dollar was out of favor, ending lower against the US dollar for the second consecutive day. Today's trading range for USD/CAD is 1.3080 - 1.3390. Growing uncertainty regarding NAFTA negotiations is starting to weigh on the Canadian dollar. Yesterday, US trade representative Robert Lighthizer said he hopes there will be a breakthrough in NAFTA negotiations i...

Gold

Outlook
Bearish
DAILY UPDATEGold prices are currently very slightly higher. Yesterday, gold ended the day flat. The precious metal found some welcome support after coming under strong selling pressure earlier this week. After making two consecutive lower-lows, the precious metal showed signs of being oversold. Today's trading range for gold is $1,160 - $1,198. Looking at the key drivers of gold, both the US dollar and US Treasury yields are flat. The US dollar is marginally lower, while US Treasury yields are flat. Thanks to rebounding risk sentiment (following recent turmoil in emerging markets), the US dollar has stabilized for the time being. In turn, the gold sell-off is taking a breather. Our outlook for gol...

Crude oil

Outlook
Bearish
DAILY UPDATECrude oil prices are slightly higher today. Both WTI and Brent crude are currently making gains. Yesterday, WTI found buyers at $64.60/barrel. Note that trading volumes accompanying yesterday's rebound were lower than the previous three sessions (when prices fell). This is a sign that traders are not buying the rebound with conviction. Today's trading range for WTI remains $61.80 - $67.90. Taking a closer look at commodity prices yesterday, the Thomson Reuters Core Commodity index rose as the broader commodities complex found support. Industrial commodity prices firmed, along with crude oil. Risk sentiment improved after China confirmed yesterday that vice-commerce minister Wang will l...

The Canadian dollar is the best performing major ‘risk on’ currency this year. Against the US dollar, the loonie is down by 4.5% this year. This beats all other major ‘risk on’ currencies including the euro (-5.3%), British pound (-5.9%) and the Australian dollar (-6.9%). In our last commentary, we argued that the outlook for the Canadian dollar was neutral thanks to rising crude oil prices and …

Published 

On August 10, we downgraded our outlook on WTI from neutral to bearish thanks to a significant deterioration of the trend. We determine trends for a number of major currencies and commodities based on price, trading volumes and changes in volatility. Following WTI’s latest top at $75.37/barrel, sell-offs in the commodity have been accompanied by accelerating trading volumes. This is a...

Published 
Tags: Crude oil

In our previous commentary on gold, we wrote that gold prices would keep falling for three reasons: (1) accelerating US inflation, (2) decelerating growth outside the United States and (3) an ongoing slowdown across emerging markets. Ultimately, all three factors were supportive for the US dollar, gold’s ultimate nemesis. Since that time (May 17), gold prices have weakened from around $1,290 to $…

Published 
Tags: Gold

In our last commentary on the Australian dollar, we wrote that the currency was an enticing short opportunity thanks to slowing Chinese growth and a bearish trend. Specifically, we recommended shorting AUD/USD as means to express a bearish view on the currency. Since that time, the pair has weakened (from 0.7560), and is trading around 0.7280 on August 13.  Going forward, we see further...

Published 

Looking at this week’s Commitments of Trader’s Report, the biggest changes in speculator positions can be seen in the US dollar index, British pound, Canadian dollar and gold. “Risk on” currencies, such as the euro and the Australian dollar, remain unattractive relative to the US dollar. Even traditional safe haven assets, such as gold and the Swiss franc, are presently no match for the dollar. T…

Published 

In our last commentary on the US dollar, we wrote that the buck was set to move higher given underlying economic trends. Specifically, US growth and inflation was likely to keep accelerating, while the opposite was likely to happen in most major regions outside the United States. Following the publication of our last commentary, the US dollar index has strengthened from around 91.80 to around...

Published 
Tags: US dollar

Looking at this week’s Commitments of Traders Report, the biggest change in speculator positions can be seen in the Canadian dollar and the Australian dollar. Following several weeks of rising net positions in the US dollar (a sign that the investor community is increasingly bullish on the currency), changes were relatively limited this week. In the short-term, the US dollar’s ongoing ascent appe…

Published 

Looking at this week’s Commitments of Traders Report, there are significant changes in the US dollar index, Japanese yen, British pound, Australian dollar and Swiss franc net speculator positions. For the past several weeks, speculators have been loading up on the US dollar while selling risk and inflation-sensitive assets. Japanese yen positions are down for the fifth week in a row, while gold p…

Published 

Looking at this week’s Commitments of Traders Report, there are significant changes in Japanese yen, gold and Canadian dollar net positions. Looking at our implied measure of US dollar positioning (the inverse of net positions in other major currencies), speculators increased their bets on the US dollar for the fifth week in a row. The significant drop in both Japanese yen and gold net positions …

Published 

There are few notable changes in speculator positions according to the latest Commitments of Traders Report. The build-up in long US dollar positions has slowed this week, relative to the significant growth we saw in recent history. This being said, speculators continued to buy the US dollar this week while reducing their positions in all other major currencies (except the Swiss franc). The bigge…

Published 

Older Posts

Subscribe to our daily update email

Currencies
Commodities