Article / 23 September 2010 at 8:59 GMT

Greenback; nothing more, nothing less

Ken Veksler Ken Veksler
Director / Accumen Management
United Kingdom

After travelling for the last 2 days and, more importantly, missing the marquee event of the week (FOMC), I am, more than ever before convinced that this whole move we’re witnessing is simply a Greenback story,  nothing more, nothing less. I hear you yelling at the screen as you read this. Yeah, but look at what’s happening out there, the world is risk-on positioned, the eurozone bond auctions were very healthily oversubscribed and thus highly successful so what sovereign debt crisis could you possible see in this?

To all of you I say open your eyes! You want to understand why this is a USD story, look at the DXY; 'collapsed' I believe is the technical term. Look at Sterling, not Cable, folks. Sterling, which sold off heavily across the board against everything else except the USD. Look at USDCAD (one of the few crosses remotely respecting fundamentals at the moment), rubbish data from Canada in the last 48hrs has put pay to the fact that yes, the greenback has been hit heavily - but when push comes to shove, back she comes.

Want more proof? Look at the equity indices, ramped higher on the back of pre-FOMC jitters (fair enough) only to come back after the initial euphoria had subsided. Yes they still look bid, but then that’s understandable in an environment in which rates will stay low for so long and QE is just a meeting or 2 away. Of course punters are looking for higher yielding instruments and better returns…

Still don’t believe me? Well do so at your own peril. Feel free to pay the highs for the EURUSD only to get chopped up in a stop hunting clean out of epic proportions, or perhaps the AUDUSD is more up your strasse, well the same applies here as it does to the EURUSD…  Either way folks, mark my words, the world will get lazy and complacent sitting dramatically short of the big dollar, and will (in a matter of a week or so) pay the price, only to be left wondering what happened.

On the data front, we’re quiet today and the pattern of the last few days will likely continue. That is EURUSD bought on dips, USDCAD rangebound with more upside risk than downside, Cable bouncing between stops on both the top and bottom sides, AUDUSD still bid and bought on dips, EURJPY still looking constructive above 112.60 etc…

As far as levels and ideas, well here they are;

EURUSD: This puppy looks like it'll run higher overall on the day but…  Look for 1.3470 to cap out, while on the downside 1.3350/80 has become important.

USDCAD: Look like it'll play the range with a heavy tilt to being long. 1.0350 is the first hurdle, with stops above, to take us (if cleared) into 1.0380/0410. Dips into 1.0230/60 might be bought.

USDJPY: The new line in the sand for the BOJ must now be 84.30/50 with a real danger sitting below 83.80. Make your own minds up here folks, but doesn't appear there's much value in this cross at the moment.

EURGBP: Another puppy that looks like it wants to run higher and I say let it. Only when we start seeing the 0.8630/50 levels being printed might traders consider selling it. On the downside 0.8530/10 provides intraday support while below there into 0.8480 remains a forest worth of wood that needs chopping.

EURJPY: As mentioned above still looks constructive above 112.60 and now 113.80/114.10 become not unreasonable targets.

AUDUSD: Still has the legs to run into  0.9630/50, but up there is likely to be sold… more on that in the coming days.


The Saxo Bank Group provides an execution-only service and all information provided on is solely for general information. 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 our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. Saxo Bank Group will not be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available as part of the or as a result of the use of the Any information which could be construed as investment research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such should be considered as a marketing communication. Furthermore it is not subject to any prohibition on dealing ahead of the dissemination of investment research. Please read our disclaimers:
- Notification on Non-Independent Investment Research
- Full disclaimer

Show latest activity
Sorry, there was a problem communicating with the servers. We are working hard to solve this. Please try again later.
Oops! There was a problem communicating with the OpenAPI Portfolio service.
Oops! There was a problem communicating with the OpenAPI History service.
Oops! There was a problem communicating with the OpenAPI Reference service.
Oops! There was a problem communicating with the OpenAPI Root service.
Oops! There was a problem communicating with the OpenAPI Trading service.
Sorry, there was a problem communicating with the Financial Calender servers. We are working hard to solve this. Please try again later.
Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail