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Commercial Member
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Joined Jan 2015
|2212 Comments
The negatives of the Pandemic have returned in earnest and forced changes against a positive view of global economic recovery momentum. Major signals from the forex markets since the start of the month are: 1. Forget commodity currencies for now because they rely upon positive momentum. 2. Marginally, USD is the best of the 3 safe havens but the magnitude of the preference is itself marginal, but measurable. 3. Even the CHF has lost ground to the JPY which may be saying a lot about the nervousness about EUR/CHF the level of which shouts to us all that SNB will intervene again but this time BIG time - do not touch CHF pairs, please, unless highly speculatively like Lotto. 4. Forget inflation related positions in any market - you do not get inflation with weak global momentum - it just does not happen. 5. Markets are preferring USD versus EUR, this is, in short, crazy, but markets are saying EUR economies are in trouble. 6. Perceptions of USA recovery and inflationary pressure rely on readings of USA and not the global context - this is serious mistake. The sizes of these changes are not huge but measurable and so not to be ignored is such a big bunch of patterns.