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Dollar may Trade with Heavier Bias Ahead of Employment Data

October 31, 2015
The US dollar was mixed last week. Consolidative technical pressure, after it spurted higher at the end of the previous week with the help of a dovish ECB and rate cuts by the PBOC, and month-end pressures dominated.  There was some disappointment that the BOJ did not ease, helping send the yen higher before the weekend. Heightened expectations fo…
Dollar may Trade with Heavier Bias Ahead of Employment Data Dollar may Trade with Heavier Bias Ahead of Employment Data Reviewed by Marc Chandler on October 31, 2015 Rating: 5
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Speculative Positioning in the Futures Market

October 31, 2015
1. There were three significant (10k contracts or more) gross position adjustments among speculators in the futures market in the Commitment of Traders reporting week ending October 27. It covers the dovish ECB press conference and the Chinese rate cuts. The dollar rallied strongly against both the euro and yen. The bears piled into the short …
Speculative Positioning in the Futures Market Speculative Positioning in the Futures Market Reviewed by Marc Chandler on October 31, 2015 Rating: 5
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Soft Inflation Data Fans Expectations RBA Rate Cut Next Week

October 27, 2015
It was a close call.  After Australia's leading banks lifted the variable rate mortgage rates recently, many observers expected the Reserve Bank of Australia to offset the tightening with a rate cut in early November.  Others emphasized that the variable rate increases were linked to regulatory changes not to financial conditions that the RBA …
Soft Inflation Data Fans Expectations RBA Rate Cut Next Week Soft Inflation Data Fans Expectations RBA Rate Cut Next Week Reviewed by Marc Chandler on October 27, 2015 Rating: 5
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Dollar Eases as Key Events Still Awaited

October 27, 2015
The Reserve Bank of New Zealand and Sweden's Riksbank can still surprise investors, but it is the BOJ and FOMC meetings that are the talk of the markets.  
Surveys suggest that around 40% of investors expect the BOJ to expand its asset purchases program this week.  We are less convinced.  Moreover, many real money clients spoken think the BOJ s…
Dollar Eases as Key Events Still Awaited Dollar Eases as Key Events Still Awaited Reviewed by Marc Chandler on October 27, 2015 Rating: 5
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Emerging Markets: Preview of the Week Ahead

October 26, 2015
(from my colleagues Dr. Win Thin and Ilan Solot)
EM starts the week off on a mixed footing.  On the one hand, hints of ECB stimulus and actual PBOC stimulus last week suggest a more supportive global liquidity backdrop for EM and risk.  On the other hand, those moves are being taken due to downside growth risks.  For now, a tug of war between the …
Emerging Markets: Preview of the Week Ahead Emerging Markets: Preview of the Week Ahead Reviewed by Marc Chandler on October 26, 2015 Rating: 5
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Policy not Data to Drive the Dollar

October 25, 2015
The European Central Bank and the People's Bank of China reanimated divergence as a critical driver just when many observers had all but given up on it. The divergence is about monetary policy, broadly understood, not about the data per se.  Of course, there is a relationship between the two but it may not be particularly tight.  
The recent st…
Policy not Data to Drive the Dollar Policy not Data to Drive the Dollar Reviewed by Marc Chandler on October 25, 2015 Rating: 5
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Observations from the Speculative Positioning in the Futures Market

October 25, 2015
1.  There were two significant (10k contracts or more) gross currency adjustments among the speculators in the CFTC reporting week ending October 20. The gross short euro position was reduced by 12.9k contracts to 138.9K.  The gross long yen position rose by 10.7k contracts to 48.7k.  
2.  There was a clear overall pattern among speculators.The gro…
Observations from the Speculative Positioning in the Futures Market Observations from the Speculative Positioning in the Futures Market Reviewed by Marc Chandler on October 25, 2015 Rating: 5
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Divergence Rewards Patient Dollar Bulls

October 24, 2015
(The second leg of this business trip brings me to Hong Kong.  In the middle of the week I will go to Beijing for a few days).  
The combination of the dovish signals from the European Central Bank and the rate cut by the People’s Bank of China lifted the US dollar just as it was threatening to fall through the lower end of its recent ranges.  Judg…
Divergence Rewards Patient Dollar Bulls Divergence Rewards Patient Dollar Bulls Reviewed by Marc Chandler on October 24, 2015 Rating: 5
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Great Graphic: Draghi Pushes Back

October 22, 2015
ECB President Draghi sent an unambiguous signal to investors.Although the economic data from the region has been largely stable, the downside risks have grown, and the ECB will take action at its next meeting, which is in early December. 
In the past, Draghi has indicated that the negative 20 bp deposit rate exhausted the scope for rate cuts. Howe…
Great Graphic: Draghi Pushes Back Great Graphic: Draghi Pushes Back Reviewed by Marc Chandler on October 22, 2015 Rating: 5
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