Playlist: us-election-2016

Show less
FX webinar: Trump — #SaxoStrats
John J Hardy
17 November 2016 at 12:40 GMT
USD pauses, for now at least – #SaxoStrats video
John J Hardy
15 November 2016 at 11:43 GMT
Finding focus in the Trump era – #SaxoStrats video
Kay Van-Petersen
15 November 2016 at 8:33 GMT
Doctor Copper may have jumped the gun – #SaxoStrats
Ole Hansen
11 November 2016 at 14:55 GMT
From the Floor: EMergency as bonds sell off — #SaxoStrats
11 November 2016 at 8:20 GMT
US Election: Trump victory sees USD weaker — #SaxoStrats
John J Hardy
09 November 2016 at 8:34 GMT
Video / 23 January 2017 at 8:34 GMT

From the Floor: Bullish 'Trump trade' in retreat — #SaxoStrats

   • Dollar retreats on Trump's inaugural address
   • Gold gains for a fourth straight week on safe-haven buying
   • Yen surging higher, driving Topic and Nikkei 225 indices lower
   • 'We are going to see what America First really looks like': Larsen
   • USDJPY could head towards 110 at the lower extreme: hardy
   • Earnings forecasts show mild reaction to new administration
   • Macro remains mildly bullish supporting overweight cyclicals
   • US oil drillers add 29 rigs last week, biggest jump since April 2013

By Michael McKenna

President Donald Trump’s speech touted what the Guardian termed ’unapologetic nationalism’ as the way forward for the US, with the dollar beating a hasty retreat as the incoming administration vowed to ”buy American and hire American” in a strongly worded protest against economic globalisation.

The reaction in Asian markets was muted as most indices climbed higher while Japan headed lower on a stronger yen. The Japanese currency was boosted by the widespread buying of safe-haven assets including the yen and gold.

“JPY has room to run,” said Saxo Bank head of forex strategy John J Hardy on today’s Global Morning Call. Hardy added that 112 could be the next major support level in the pair with the bottom of the current Ichimoku cloud sitting around 110, potentially signalling a further downside target for the pair.

“The market was spooked by Trump’s embracing of protectionist rhetoric,” says Hardy, “and we saw bonds snapped up as incestors sold the greenback”.

In EURUSD, adds Saxo’s FX strategy chief, 108.00-50 is likely the next level to watch.


Create your own charts with SaxoTraderGO click here to learn more

Source: Saxo Bank 

Speaking live from Saxo’s FX Options desk in Copenhagen, Dan Juhl-Larsen said this morning that “we are going to see what ‘America First really looks like” in terms of asset movement, with Larsen adding that one-month USDJPY volatilities are currently trading at a “fair level” while risk-reversals remain cheap. “We think this could be an interesting time to get long USDJPY volatility,” concludes Larsen.

This second, post-Inauguration chapter in the “Trump trade” will likely provide a good degree of this week’s sentiment as far as US assets are concerned, while earnings season will provide the rest.

According to Saxo Bank head of equities strategy Peter Garnry, we are seeing a mild overall reaction to the incoming administration in US corporates as revenue growth remains low at 0.4% year-over-year while “we remain solid in terms of EBITDA”.

This week seems Microsoft, Alphabet (Google’s parent company), Johnson & Johnson, McDonald’s, Qualcomm, SAP, Novartis, and Santander reporting earnings. Concerning the latter, Garnry says that the Spanish bank’s performance in Spain and Brazil will be key to any upside surprise.

While crude oil remains rangebound, Saxo Bank head of commodities strategy Ole Hansen reports that US drillers added 29 rigs last week, the largest surge since April 2013, well before oil’s pronounced retreat from longer-term highs that started in mid-2014.

“Gold was lifted as well on a combination of a weaker dollar and uncertainty over Trump’s policy agenda,” says Hansen, adding that funds bought gold for the second straight week last week while increasing their gross short as well.

Hansen sees the current WTI oil range as lying between $50.70 and $53.50/barrel while Brent could range from $53.60 to $57/b.

Finally, notes Hansen, copper is in a $2.6-7/lb. range while coffee was bought for a second straight week while the net long remains 63% below its November 8 peak.

Beyond the rhetoric: incoming US president Donald Trump faces a rocky path as the US establishment and markets remain reserved on his nationalist intentions. Photo: iStock 

Michael McKenna is an editor at Saxo Bank

Editor’s note: From the Floor takes advantage of's unique real-time access to Saxo Bank’s various trading desks around the globe to put our community in touch with the developments that matter to their portfolios 
Relevant articles for you


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer
- 沪ICP备13028953号-1

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail