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USDCAD TECHS

Heading North

GLOBAL POLITICAL RISK

Modi, AMLO Top Major Economy Leader Poll, Macron Last

AUDUSD TECHS

Under Pressure

EURJPY TECHS

Trend Condition Remains Bearish

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  • Market sentiment has been strongly bullish on the US Dollar amid rising uncertainty and the strong deceleration in liquidity as Fed prepares for tapering.
  • To the exception of the Japanese yen, which currently has the highest 3M 25D Risk Reversal in the FX world (+0.13), the options market is pricing in further USD strength in the coming months.
  • This chart shows the 3M 25D Risk Reversal for the CEEMEA FX market (positive RR implies USD strength and vice versa).
  • The recent 'dovish' CBRT decision to cut its benchmark rate by 200bps to 16% led to some TRY depreciation, currently trading at an all-time low slightly below 9.50.
  • 3M 25D RR surged to 6.3 (up from 5.7 yesterday and 5.5 the previous month).

Source: Bloomberg/MNI