John J Hardy
Sterling has been falling since last week particularly against the dollar. Saxo's John Hardy on why it could fall further. He also discusses the big data points coming up over the next week and why he's been buying the Aussie dollar.
Trade view / 15 November 2012 at 10:29 GMT

Shorting EURGBP ahead of key resistance

Head of FX Strategy / Saxo Bank

A few highlights from this trade idea (see PDF attached to this post for full details):

  • The Euro got a boost on the recent hopes that Greece would be given a break on its debt and possibly as well on a simple positioning squeeze, particularly in the likes of crowded Euro/commodity currency shorts
  • Meanwhile, sterling has been punished as the BoE's King wouldn't rule out further asset purchases and complained a bit about sterling's strength and as the latest quarterly BoE Inflation Report showed reather dour growth and inflation forecasts for the coming year.
  • EURGBP has risen rather sharply on these developments, but the upside could fade ahead of the 200-day moving average as the EU issues are intractable and as the GBP still looks like a safer harbour for capital than Europe.

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