GBP/USD Comments:
• Anna Coulling: Despite pullback sterling still remains bullish as markets reward UK fiscal policy. Expect to see 1.64 tested again. • Ilian Yotov: The GBP could stay supported ahead of the BOE announcement, but could suffer the consequences if the BOE decides to stay on the sidelines for another month. • Yohay Elam: There are good reasons why the members of the MPC are still reluctant to raise the rates, despite soaring inflation. The economy is weak. The pound is likely to continue shaking, and then drop. • Mohammed Isah: GBPUSD remains trapped within its sideways trading range as it continues to look for meaningful directional moves. Within one to three months, we have a bullish bias on the pair.
EUR/USD Comments:
• Anna Coulling: The short term technical picture for the eur/usd remains mildly bullish although could be getting tired at this level. Dollar shorts now at an extreme which could be an important signal for a reversal. Pair likely to struggle anywhere above 1.43 • Ilian Yotov: The EUR could re-test the Nov. 2010 highs around $1.43 on ECB rate hike expectations, but the EU debt crisis and Portugal bailout fears could cap further gains following the ECB announcement. • Yohay Elam: While the rate hike next week continues to support the common currency, the situation in Portugal and also again in Ireland is likely to weigh on EUR/USD. • Mohammed Isah: While EURUSD holds within its established bullish channel, our bias remains to the upside. Our overall outlook remains bullish in one to three months.
USD/JPY Comments:
• Anna Coulling: BOJ must be delighted as usd jpy turns bullish to test resistance in the 83 84 area once again. • Ilian Yotov: Hawkish statements from Fed officials and the return of risk appetite are helping the USD to stand on its own feet against the JPY. • Yohay Elam: The rise of Dollar/Yen finally began and hasn't ended yet. The situation in Japan, which wasn't too good before the catastrophe, and the rising US yields, as QE2 is about to end, all point in the same direction for the pair: up. • Mohammed Isah: The pair remains biased to the downside long term but now faces a recovery higher having halted its recent weakness. Risk points to the 83.96/84.39 levels. We retain our long term bearish call in three months.
USD/CHF Comments:
• Anna Coulling: Could see a further push lower before a sustained rally higher. • Ilian Yotov: The multi-year bullish trend of the CHF vs. USD is still strong and only a Fed exit from their current ultra-accommodative monetary policy could reverse it. • Yohay Elam: The ultimate safe haven currency continues to have all the reasons to rise, as Mid-East tensions are huge. Nevertheless, in the long term, the excessive strength might give way to a correction. • Mohammed Isah: Despite its attempt at recovering higher, USDCHF remains challenged by its broader long term bearish structure. We are bearish on the pair in one to three months.
Keys:
• Bearish: Belief that a particular currency is about to fall in value; understood as a general pessimistic trend about the state of that given currency. • Bullish: Belief that a particular currency is about to rise in value; understood as a general optimism about the state of that given currency. • Sideways: A sideways trend manifests when the volume of a currency pair bought and the volume of the same pair sold at a particular price are in balance or nearly in balance.
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