Credit Agricole
– The EUR faced some selling interest last week, predominantly driven by IMM flows. Our FX flow data points at corporates and hedge funds inflows, as well as banks and real money investors outflows. All in all, the EUR is now in oversold territory. n The JPY experienced fresh selling interest last week, predominantly driven by Risk Reversals flows. Our FX flow data points at banks inflows, as well as corporates, hedge funds and real money investors outflows. All in all, the JPY remains in overbought territory.
– The CHF saw new buying interest last week, predominantly driven by IMM flows. Our FX flow data points at hedge funds and real money investors inflows, as well as banks and corporates outflows. Ultimately, the CHF remains in overbought territory.
– The USD remains the biggest long in the G10 FX at present despite new selling interest last week, predominantly driven by Crédit Agricole CIB flows. Our FX flow data points at banks, hedge funds and real money investors inflows, as well as corporates outflows.
– The GBP returned as the biggest short in the G10 FX after fresh selling interest last week, predominantly driven by algo trading flows based on FX technicals signals. Our FX flow data points at corporates and hedge funds inflows, as well as banks and real money investors outflows.
– The AUD saw new buying interest last week, predominantly driven by IMM flows. Our FX flow data points at corporates and hedge funds inflows, as well as banks and real money investors outflows. The NZD saw some buying interest, predominantly driven by IMM flows too. Our FX flow data points at banks, hedge funds and real money investors inflows, as well as corporates outflows.
– The CAD experienced some selling interest last week, predominantly driven by IMM flows. Our FX flow data points at corporates and hedge funds inflows, as well as banks and real money investors outflows.
– The NOK faced some selling interest last week, predominantly driven by Risk Reversals flows. Our FX flow data points at corporates and real money investors inflows, as well as banks and hedge funds outflows. The SEK saw new buying interest, predominantly driven by Risk Reversals flows. Our FX flow data points at banks inflows, as well as corporates, hedge funds and real money investors outflows.
EUR/USD’s fair value has declined from 1.0517 to 1.0460 on the back of a renewed widening of peripheral bond yield spread to Bunds and a further dip of the EUR-USD rate spread deeper into negative territory. The moves reflected growing political risks in Italy as well as persistent worries about the Eurozone growth outlook that could complicate the ECB’s policy normalisation plans. Despite the latest dip in its short[1]term fair value, EUR/USD remains more than two standard deviations undervalued. Subsequently, the FAST FX model has triggered a buy EUR/USD trade with a stop-loss of -2.55% and a take-profit level of 1.0460.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% and 68% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Written by James Harte
With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.
Previous Post
Daily Market Outlook, July 19, 2022
Source: Tickmill
