36 Currency Price Closes: Highest to Low, EM, ASIA and EUROPE

EUR/HUF 331.075

USD/HUF 299.40

SGD/JPY 79.82

EUR/INR 78.83

USD/INR 71.28

USD/RUB 63.7533

USD/THB 30.36

EUR/CZK 25.5395

USD/MXN 19.3100

EUR/ZAR 16.1701

USD/ZAR 14.6271

GBP/SEK 12.4791

GBP/NOK 11.9879

NOK/JPY 11.9008

SEK/JPY 11.4344

EUR/SEK 10.5040

EUR/NOK 10.0905

USD/SEK 9.4981

USD/NOK 9.1256

GBP/TRY 7.5907

ZAR/JPY 7.4263

EUR/TRY 6.3900

USD/TRY 6.7781

EUR/MYR 4.60

GBP/ILS 4.5566

EUR/PLN 4.2758

USD/MYR 4.15

USD/PLN 3.8664

EUR/ILS 3.8351

USD/ILS 3.4680

GBP/SGD 1.7872

EUR/SGD 1.5046

CHF/SGD 1.3737

USD/SGD 1.3605

AUD/SGD 0.9304

 

Brian Twomey Interested to Trade above pairs, contact

 

 

FX Forwards Monday Morning Macro

 

Lifted from Monday Morning Macro

There’s been a lot of discussion recently about $ strength preventing risk assets from making new highs. I don’t dispute the fact: it’s obvious we’re losing badly in the battle for competitive devaluation that global central banks have embarked upon. But it’s even worse than the headlines might suggest. Where the real damage is being done is in FX forward markets. In some cases, 12mth $ funding has more than doubled in the last two months alone.

One thing is clear, to refer to this as a “USD bull market” is not correct. As others have correctly pointed out: it’s really a bear market for $ funders. Typically, we’d see this manifest in overnight repo rates, but that’s not really happening. We might also see this show up in LIBOR/OIS spreads (and cross-currency basis) & it has, but to a fairly limited extent.

Where this is showing up instead is in FX forwards. In times of trade war, this is currency krav maga – the art of self-defense as a weaker opponent can gain the upper hand even in the face of seemingly insurmountable odds.

Consider this: since the start of the year, the average 1-year funding cost in EUR, GBP, JPY & CAD has moved by about 30%. Cheaper for those currencies, more expensive for the dollar.

Moreover, it’s showing no signs of stopping. It’s essentially an explosion of the developed markets FX carry trade: borrow in currencies where interest rates are low (or, in many cases, negative), to invest in those countries where yields are high. In order to do that, you need dollars. In the case of each of the 4 currencies listed above, the forward value of the dollar is cheaper than the spot – making the trade that much more attractive. Perhaps this stops when we reach zero, perhaps it just continues.

But that’s not even the biggest move. Beyond the developed markets, the real jump has taken place in just the last month as USDCNH forward points have gone up by more than 2x.

On a trade weighted basis, this is a monster move.

Take the top 10 currencies on a trade weighted basis (I’ll use the Fed’s weights for the sake of comparison).

https://www.federalreserve.gov/econres/notes/feds-notes/revisions-to-the-federal-reserve-dollar-indexes-20190115.htm

Consider what the trade weighted $ performance has been in spot space.

Now, overlay what the trade weighted $ performance has been in forward space all-in (spot + forward points).

Bottom line, it’s pretty clear that this $ move is being driven by the forward borrowing cost versus our major trading partners. In a trade war, this is logical self-defense. But the extent of the move is going almost entirely unnoticed since the spot richening of the $ has been “only” 5% over the same time period.

Until the forwards begin to retreat in a meaningful way, it’s only reasonable to presume this move should continue.

Disclosure/Disclaimers: This material may contain indicative terms only, including but not limited to pricing levels. There is no representation that any transaction can or could have been effected at such terms or prices. Proposed terms and conditions are for discussion purposes only. Finalized terms and conditions are subject to further discussion and negotiation. OTC Derivatives Risk Disclosures: To understand clearly the terms and conditions of any OTC derivative transaction you may enter into, you should carefully review the terms of trade with your counterparty, including any related schedules, credit support documents, addenda and exhibits.

You should not enter into OTC derivative transactions unless you understand the terms of the transaction you are entering into as well as the nature and extent of your risk exposure. You should also be satisfied that the OTC derivative transaction is appropriate for you in light of your circumstances and financial condition. In addition, you may be requested to post margin or collateral to support written OTC derivatives at levels consistent with the internal policies of your respective counterparty. I may have positions in assets mentioned above, but do not have plans to initiate any new positions within the next 72 hours.

This post was written by me, the material is my own (except where sourced), and it expresses my own opinions. I am not receiving compensation for it & have no business relationship with any of the companies and/or organizations whose assets may be mentioned in this post.

 

Brian Twomey

Weekly Trades: GBP/USD, GBP/CHF and GBP/JPY

 

For this week’s trades, GBP/USD, GBP/JPY and GBP/CHF as not only did GBP/USD and GBP/CHF close at 1.2926 but GBP/USD and GBP/CHF fits into my NZD analysis as currency prices serve as support and resistance levels against each other.

Big line breaks for lower GBP/USD, GBP/CHF and GBP/JPY are located at 1.2759, 1.2681 and 138.62. See GBP/CHF 1.2681 holds GBP/USD at 1.2759 and 1.3862 GBP/JPY trades far above both GBP/USD and GBP/CHF.

GBP/CHF must move down in order for GBP/USD to trade lower. As GBP/CHF trades lower then former GBP/CHF supports translates to GBP/USD supports on the way down. GBP/JPY becomes the follower to GBP/CHF and GBP/USD.

If GBP/CHF fails to move down or trades higher then GBP/USD is well supported by GBP/CHF and won’t trade lower. This translates to GBP/JPY non ability to trade lower and this situation serves for all GBP pairs.

GBP/CHF contains higher ranges than GBP/USD by design and GBP/JPY contains higher ranges than GBP/USD and GBP/CHF.

GBP/USD is stuck dead center as a middle range currency pair and requires movement from GBP/JPY or GBP/CHF in order to provide direction.

Actual commentary should state GBP/USD moved higher to GBP/CHF X Point or lower at GBP/CHF support because mathematically, supports and resistance points are perfect. Applies to targets a perfect mathematical points.

A break of GBP/USD 1.2759 targets 1.2610 on a break of 1.2685. GBP/CHF below 1.2681 targets 1.,2509 on a break of 1.2595. And GBP/JPY below 138.62 targets 136.47 on a break at 137.54.

Overall GBP strategy this week is short at higher levels.

GBP/USD

Short 1.2982 and 1.3019 to target 1.2833. Must cross 1.2945, 1.2908 , 1.2871 and 1.2859.
Short below 1.2759 to target 1.2685. Must cross 1.2722.

GBP/CHF
Short 1.2939 and 1.2982 to target 1.2766. Must cross 1.2896, 1.2853 and 1.2810. Short below 1.2681 to target 1.2595.

GBP/JPY
Short 141.80 and 142.33 to target 139.85. Must cross 141.27, 140.74, 140.47 and 140.20.

 

Brian Twomey

NZDUSD As Anchor Currency Further Results

NZD’s purpose within G28 currency pairs is its the lowest exchange rate therefore NZD serves as the anchor currency. After the Fed releases daily interest rates every trading afternoon, the RBNZ is the first nation to factor its interest rates against Fed rates. All nations then follow RBNZ interest rates, particularly the RBA.

Closing Prices Highest to lowest

GBP/NZD 2.0129

GBP/AUD 1.9123

GBP/CAD 1.7157

EUR/NZD 1.7151

EUR/AUD 1.6291

EUR/CAD 1.4624

GBP/JPY 1.4155

USD/CAD 1.3273

GBP/USD 1.2926

GBP/CHF 1.2926

EUR/JPY 1.2061

EUR/CHF 1.1016

EUR/USD 1.1015

CHF/JPY 1.0951

USD/JPY 1.0948

AUD/NZD 1.0534

USD/CHF 0.9995

AUD/CAD 0.8980

NZD/CAD 0.8525

EUR/GBP 0.8519

CAD/JPY 0.8245

CAD/CHF 0.7534

AUD/JPY 0.7421

NZD/JPY 0.7046

AUD/CHF 0.6767

AUD/USD 0.6759

NZD/CHF 0.6423

NZD/USD 0.6417

Subtract Above pairs minus NZD/USD then Factor Mid Points

GBP/NZD – NZD/USD = 1.3273 = USD/CAD Close. As a reciprocal 0.7534 results in CAD/CHF close.

GBP/AUD – NZD/USD = 1.2770 = GBP/USD and GBP/CHF. As a reciprocal GBP/USD 1.2770 as a reciprocal results in USD/GBP 0.7840 and trades between CAD/CHF and CAD/JPY.

GBP/CAD -NZD/USD = 1.1787 No immediate association found however reciprocal to 1.1787 equates to 0.8483 and located between AUD/CAD, NZD/CAD and EUR/GBP. The number 0.8483 holds deep trade significance to NZD/CAD and EUR/GBP.

EUR/NZD – NZD/USD = 1.1787. Same number and significance as above.

EUR/CAD – NZD/USD = 1.0520 = AUD/NZD at a significant exchange rate. As a reciprocal AUD/NZD 1.0520 is actually 0.9505 NZD/AUD and trades between AUD/CAD and USD/CHF.

GBP/JPY – NZD/USD =1.0286 = Between USD/CHF and AUD/NZD. The number 1.0286 holds significance as CHF/USD and at the moment unrelated significantly to AUD/NZD.

GBP/JPY 141.55 – NZD/USD = 71.09 = NZD/JPY 0.7046. NZD/JPY not only closed at 0.7028 or 70.28 but 71.09 is a vital number to our weekly trade. Further, 0.7046 trades between AUD/JPY, AUD/CHF and AUD/USD. NZD/JPY 0.7046 as a reciprocal 1.4192 trades between GBP/JPY and EUR/CAD.

USD/CAD – NZD/USD =0.9845 = USD/CHF and CHF/USD as the reciprocal to 0.9845 equates to CHF/USD 1.0157.

GBP/USD – NZD/USD = 0.9671 Between USD/CHF and AUD/NZD however 0.9671 as a reciprocal 1.0340 equates more as a trade seignal to AUD/NZD.

GBP/CHF – NZD/USD 0.9671 = Between USD/CHF and AUD/NZD

EUR/JPY – NZD/USD =0.9239 between AUD/CAD and USD/CHF however 0.9239 as a reciprocal equates to 1.0923 as is more related to USD/JPY and CHF/JPY.

EUR/CHF – NZD/USD = 0.8716 = Between AUD/CAD, NZD/CAD and EUR/GBP.
EUR/USD – NZD/USD = 0.8716

CHF/JPY – NZD/USD = 0.8684 Between NZD/CAD, EUR/GBP and AUD/CAD. As reciprocal holds significance also to CAD/NZD at 1.1515.

USD/JPY – NZD/USD = 0.8682 – Between NZD/CAD, EUR/GBP and AUD/CAD. Same as above.

AUD/NZD – NZD/USD = 0.8475 = Between CAD/JPY and EUR/GBP

USD/CHF – NZD/USD = 0.8206 = Between CAD/JPY and EUR/GBP. As reciprocal 1.2186 then bumps against GBP/USD and GBP/CHF territory.

AUD/CAD – NZD/USD = 0.7698 Between CAD/CHF and AUD/JPY. As reciprocal 1.2990 now bumps against USD/CAD.

NZD/CAD – NZD/USD = 0.7471 = Between CAD/CHF and AUD/JPY. As reciprocal 1.3386 now nears USD/CAD.

EUR/GBP – NZD/USD = 0.7468 = Between CAD/CHF and AUD/JPY. As reciprocal 1.3390 again bumps into USD/CAD territory.

CAD/JPY – NZD/USD = 0.7331 = Between AUD/JPY and NZD/JPY. As reciprocal 1.3640 reigns to USD/CAD and GBP/JPY.

CAD/CHF – NZD/USD = 0.6975 = Between NZD/JPY and AUD/CHF and AUD/USD. As reciprocal 1.4336 now bumps against EUR/CAD and GBP/JPY.

AUD/JPY – NZD/USD = 0.6919 = Between NZD/JPY, AUD/CHF and AUD/USD. As reciprocal 1.4452 also bumps against EUR/CAD and GBP/JPY. As reciprocal 1.4452 located between EUR/CAD and EUR/AUD but remains significant to GBP/JPY.

NZD/JPY – NZD/USD = 0.6731 = Between NZD/JPY, AUD/CHF and AUD/USD. As reciprocal 1.4856, same as above.

AUD/CHF – NZD/USD = 0.6592 = Between NZD/CHF and AUD/USD. As reciprocal 1.5169 located between EUR/CAD and EUR/AUD.

AUD/USD -NZD/USD = 0.6588= Between NZD/CHF and AUD/USD. Same as above.

NZD/CHF – NZD/USD = 0.6420 = NZD/USD. Same as above Vs reciprocal 1.5576.

Results

Exchange rate numbers contain deep associations and serve as valuable support and resistance levels against each other in a deeply self contained market. Currency price numbers meet supports and resistance at the next highest and lowest exchange rate numbers. Exchange rate numbers customarily cross above and below the next currency.

The amount of actual and highly profitable trade signals offered above is not only quite astounding but a simple calculator is the only tool needed for profitable trading. Math in its most sophisticated and/ or highly basic form eliminates in favor to understanding. If 70% of traders actually lose as stated then old dinosaur ways simply don’t work nor worth repeating.

GBP/JPY is clearly the most versatile currency pair among JPY cross pairs and GBP/JPY as GBP/JPY exchange rate allows for multiple insightful factors both as the stated price and movement of the decimal. USD/JPY nor any JPY cross pair allows GBP/JPY’s versatility. The results to USD/JPY and other JPY cross pairs without decimal move lacks assistance to meaningful trade understanding or insights.

GBP/JPY as an insight to NZD/JPY is truly perfect to nearly the exact pip.

GBP/NZD minus NZD/USD contains a mid point at 0.6856. This means 24 of 28 currency pairs trade above and 4 pairs below as follows: AUD/USD, AUD/CHF and NZD/USD and NZD/CHF.

Al 28 currency pairs contain a mean of 1.1318 with inclusion of JPY re arranged but if USD/JPY is included as well as stated JPY cross pairs then the mean drops to 26.17. USD/JPY and JPY cross pairs are true market distortions as exchange rates lack proper representation and trade ability as stated prices.

Brian Twomey,