The Week Ahead 2nd July


It all started with EURUSD last Tuesday and “nothing hawkish” comments from Draghi. Despite throwing cold water on buyers the day after we are now still at a key level – 1.1450. Cable came to the party a little later and is toying with 1.3050 These are key levels for USD bargain hunters. If they show up, and I think they will again this coming week expect these areas to be sticky. If Asia breaks USD capitulation will be likely near to a big fig on both majors. On that note a few large mean-reversion quants are buying USD as we are now at the very edge of a key value area. If you have Market Delta/profile it makes sense to take a look.

USDJPY key area is 111.80 and a perfect platform for more buyers. 112.90 failed but if 113.00 breaks and holds I see 114.30 on the radar. This runs against a broad weak USD but risk plays and month end dictated last week in my humble opinion.

USCAD broke a key level at 1.30 big fig and also got resold on the retest. Looking very bearish now as 1.30 stands firm. Oil closed at 46.30 and is on a tear. Look for this to continue I guess.

NZD and AUD firm – but all big gifts from USD rather than fundamentals

Next week

  • US/UK PMI’s, NFP and Carny on the lectern
  • The US has a last hope of overlooking weak soft data and now CPI – with a stonking NFP. If this disappoints it’s last chance saloon but the bar has closed. And you can forget a recent good GDP to calm the bears.
  • OIL is the measure that raise all tides. Inventories on the radar after >2 buck rally on Friday.
  • Steve Cohen still hiring in London. But this time it’s youngsters. Maybe that’s where the talent lies now ? I know Brevan Howard might agree. 😉

That’s it folks. Catch Patrick Reid on Linked in – normal rules apply. Send it comments as I like to be told I’m wrong 😉

Trade safe and be lucky

Patrick and Adam


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About Patrick Reid

Patrick Reid has written 23 post in this blog.

Patrick Reid is a veteran FX Trader and Analyst. He also has inroads to BBC News and has a great knowledge of Geopolitical landscape