Video

Kim Cramer Larsson
Areas covered in this webinar by Saxo Bank technical analyst Kim Cramer Larsson include EURUSD, USDJPY, GBPUSD, EURGBP, gold, silver, S&P 500, the Nasdaq, the Dax, the FTSE and the Dow Jones.
Squawk / 09 August 2018 at 11:25 GMT
Head of FX Strategy / Saxo Bank
Denmark
Due to internal misunderstanding: just now became aware that this morning's FX Update didn't make it to this website. Will now squawk out the update in pieces.

FX Update: NZD plunges on dovish RBNZ. GBP struggles
RBNZ pushed its dovish guidance out into 2020, a move the market wasn’t expecting, and kiwi plunged to new lows for the cycle. Elsewhere, traders can’t figure out to do with the US dollar, while the Russian ruble was sent into a tailspin on new sanctions threats.
The big dollar is flopping around with no conviction, perhaps merely owing to the increasingly low volatility summer doldrums in equity and bond markets and the lack of any of the incoming data on tap will do anything to shift expectations for the Fed’s policy trajectory. It’s a long wait for the late September Fed meeting (hike 91% priced anyway there) with the uncertainty premium greater for the December meeting – with another hike only priced at 65% odds. Elsewhere, plenty of volatility in individual currencies:
09 August
John J Hardy John J Hardy
Russian Ruble: the ruble weakened sharply yesterday, initially on the leak of the text of an proposed Congressional bill sponsored by Menendez and Graham (https://finance.yahoo.com/news/u-sanctions-threat-hurts-russian-101020200.html that proposes new harsh sanctions on Russia, including the airing of personal information on Russia’s leader Putin and sanctions against key Russian banks and even holders of Russian sovereign debt. Adding to the pressure on the ruble in later trading was an official US announcement agreeing that the Russian double agent Skripal had been poisoned in the UK by Russian operatives, a move that will lead to additional sanctions (many of which are already effectively in place and less severe than those proposed in the Graham-Menendez bill).
09 August
John J Hardy John J Hardy
NZD: a sharp weakening in the kiwi overnight as the RBNZ statement pushes its unchanged guidance (for the current 1.75%) cash rate all the way out into 2020, taking the market by surprise.
- Canada: at least some of the recent volatility in the Canadian dollar attributable to the intense spat between the country and Saudi Arabia as the latter has cut off all diplomatic relations with Canada and has demanded the liquidation of all Canadian assets held by any official Saudi asset manager. Saudi Arabia feels insulted by official Canadian sources urging the release of womens’ rights activists detained in Saudi Arabia.
09 August
John J Hardy John J Hardy
- US treasury yields: US yields remain stable after a very strong US 10-year auction yesterday despite the auction’s record size for that maturity. A lower than usual allotment to primary dealers was noted, indicating strong demand from other participants. A large 30-year auction is today, with demand likely also strong and frustrating attempts to call US long yields higher. The US yield curve has steepened a few basis points after posting a low for the cycle (for the 2-10’s) near 25 basis points
09 August
John J Hardy John J Hardy
Chart: AUDNZD
AUDNZD ripped higher on the RBNZ’s dovish broadside that saw the Australian versus New Zealand yield spread widen to around 18 basis points for 2-year swaps, the widest since 2013, when AUDNZD was trading closer to 1.2000 (on its way down from over 1.30 in 2012). With this high momentum break motivated by an RBNZ on a mission, the 1.1250-1.1300 area looks very close suddenly and we couldn’t even see a move toward 1.1500 eventually if the yield spread widens further.
09 August
John J Hardy John J Hardy
The G-10 rundown
USD – the dollar is doing absolutely nothing at the moment, somewhat weaker over recent sessions, though that move merely neutralizing former strength. Waiting for a bigger impulse and not hopeful that tomorrow’s July US CPI release prompts fresh drama.
EUR – the euro rally losing some steam as Italy’s yields pick up. The Five Star Movement leader and Deputy Di Maio saying he will use tough tactics in EU budget negotiations and as prime minister Conte says the government intends to move forward with its flat tax and citizen’s income plan over the course of five years (estimates vary, but some estimate the programs could cost some 5% of GDP)
JPY – USDJPY can’t seem to work down through the 111.00 area with conviction – seems we might need a dose of risk off and/or volatility in global yields to get the yen on the move here.
09 August
John J Hardy John J Hardy
GBP – sterling continues to slide and EURGBP has even worked up through the 0.9000 area. Not convinced that the upside there has further major potential. At some point, the market may realize that a no-deal Brexit will also weigh on the EU’s growth prospects. But the break of 0.9000 could pull the focus ton 0.9300 eventually.
CHF – the EURCHF rally fizzled as Italy’s yield snapped back higher from yesterday’s drop. The 1.1500 area is the technical key for more downside potential, though the coincident indicator is the direction in Italian yields
AUD – the Aussie possibly stronger via AUDNZD flows overnight, but the recent stability in the CNY also helping at the margin the price for Australia’s largest export, iron ore, has picked up strongly over the last week, perhaps in anticipation of a new round of Chinese stimulus.
09 August
John J Hardy John J Hardy
CAD – USDCAD’s recent sharp rally may have been a one-off linked to Canada’s intense spat with Saudi Arabia – we’ll avoid over-intepretation of the near term action and keep the 1.3000 pivot level in our sights as the bull-bear line.
NZD – a deserved slide in the kiwi on the latest dovish blast from Governor Orr and company. Still, to keep the slide on track beyond the next hurdle around 1.1250+ in AUDNZD will require a drumbeat of new NZ-negative inputs.
SEK and NOK – EURSEK pushing all the way to 10.40, possibly on the very uncertain political scenarios post the September 6 election. We suspect this means little for the state of the economy, however, so we look for ways to fade the fear with limited risk, such as via downside options and options spreads with expiry dates several weeks after the election. NOK – getting concerned if the line in the sand on the crude chart gives way, not that crude prices have served as a solid indicator on the krone recently.
09 August
John J Hardy John J Hardy
Upcoming Economic Calendar Highlights (all times GMT)
1215 – Canada Jul. Housing Starts
1230 – US Weekly Initial Jobless Claims
1230 – US Jul. PPI
1300 – Mexico Jul. CPI
1700 – US 30-year Treasury Auction
2350 – Japan Q2 GDP
09 August
Coco84 Coco84
Any updates on the new home.saxo insights website? It was supposed to replace tradingfloor at the end of July. I see it's business as usual on tradingfloor though...
10 August
marran marran
good question Coco84 Saxo what is happening with the new site?
10 August
Forex Signals Forex Signals
good

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