The USD and the CHF remain strong, the EUR and the AUD remain weak, and the GBP and JPY are more or less unchanged from yesterday.
- If the COT data mentioned earlier is reliable, then the market is not yet short EUR and there may still be some downside potential there.
- The AUD is coming off record highs and most of the recent factors are bearish (Korea, China, RBA, and business data) so that also looks to have more downside.
- The USD was heavily oversold around the last FOMC and speculators are unwinding before markets become too illiquid
- The CHF is always a safe-haven in times of geo-political uncertainty
- The GBP and the JPY have also been sliding lower in recent weeks but the cross plays especially against the EUR are limiting losses.
I can’t see any reason for these short-term trends to suddenly reverse but wait for moves to exhaust themselves before jumping in as liquidity is getting worse, day by day.
Good luck today.
