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ridethepig | BOE & FED ComboThis is a quick update to do with pricing in rates, or what's already priced in rate market ... I wont try my best to keep it short and sweet. I have been receiving many PM's and comments around how do we know when the Fed cuts are fully priced in? For example the -50bps that the market forced earlier in the week...everybody knew they were coming, they just didn't know it would be a surprise before the meeting. When it comes to the fundamentals and pricing in rate cuts, the macro is slightly different on each side. The reason it's different is because of timing and placement in the economic cycle. On the UK side, when we walk forward, the further out you go in time, the more relevant Brexit becomes. Why? The market has been incrementally pricing as we've gone along... doing it in small pieces because that's how markets like to move. The market didn't sit at the highs saying well we've got a new fiscal budget coming with tax cuts on the horizon, the taps on full blast and BOE ready to bend the knee, so lets start selling GBP and suddenly GBPUSD was down 300 ticks. Then markets looked at the 1.275x lows and did another forward walk, this time saying there is no point in going lower because of Fed cuts via coronavirus short-circuit, these are not fully priced so lets take another test of the 1.300x highs as there is more money to be made in the slow train !!! The macro traders know this, a BOE intervention is only a matter of when and if they can wait till the meeting. We have the budget next week and a very aggressive Fiscal policy may offset the need to act inbetween although, another they will not appreciate another hammer in UK Equities so eyes there to begin the week. Mostly when talking about whats being priced in, it's on the incremental level. So you will remember the GBP devaluation we are trading via Brexit: This is the future, what the market will try and do is price it all in small increments. The biggest moves, the ones with real volatility will come only sessions before the actual fact of Brexit annihilation. The market is not interested in these small 50 ticks or 75 tick retracement, the further out you go the more relevant the macro becomes. You see here with the PM May resignation: Markets priced in a little before, but you usually don't know enough details until shortly before the fact. Then before the announcement, maybe price moved 100 ticks... then markets expect it to be hawkish ... if that's the case with Boris then it gets priced and if they do not deliver then it will be priced back out. For the technical 🗺 Steel Support 1.241x <=> Strong Support 1.258x <=> Soft Support 1.275x <=> S/R Flip 1.293x <=> Strong Resistance 1.310x <=> Steel Resistance 1.321x It's macro ... the titanic takes a long time to turn ... Good luck all those in GBP and UK assets, here tracking a pullback in GBPUSD via BOE intervention and -50bps front loaded cut. I don't think they will be able to wait till the meeting! Thanks for keeping the support coming with likes, comments and etc!!
Short
by ridethepig
7
ridethepig | Continue To Sell GBP On Rallies Here tracking 1.295x as the level to recycle and load more shorts. Well done those following from the original short-term swing which was triggered on the cabinet reshuffle (see diagram below). As widely expected GBP suffering as markets began to look towards the EU negotiations kickstarting in March. Both sides are very wide apart and no-deal Brexit looks set for year end. The flows are all in-line so far with the long-term macro picture. It is playing out perfectly and looking to sell rallies with risks skewed towards the downside makes sense to me. Medium term targets are located below at 1.21 and 1.15 - these are in play for 1H 2020 if things get very bad with USD strengthening via panic around virus impact and risks while GBP softens as UK lose PPP in the immediate term. Well done those already selling Sterling, and good luck anyone look to load more on rallies. I am happy to sit short and work the sell-side in Cable. The ideas are no less imaginative than those of last year which turned out to be a 1,000 tick trade: Thanks as usual for keeping the likes, comments and charts coming !
Short
by ridethepig
4
ridethepig | EURGBP Market Commentary 2020.02.13A weak session for EURGBP, soft hands continued to bring better sellers in from leveraged accounts and yet the important 0.8300x support still held. I am once again in BTFD mode as pound remains more vulnerable in the entire process as a result of financial services replacement. Risk markets will put more pressure on GBP in general over the coming sessions. Here using dips to buy into with an end of year target at 0.95xx. BOE are already showing signs of distress with the cross below 0.853 which is key via rate differentials. A very technical flow as is usually the case with these cabinet reshuffles we get a retrace in the swing. Adding this to the playbook at the close today with initial targets located at 0.8400, followed by 0.8425 and 0.8450. Invalidation comes into play with a daily close underneath 0.830x. Good luck all those on the bid, same legs are playable in GBPUSD and GBPJPY in particular too. As usual thanks for keeping the support coming with likes and comments!
Long
by ridethepig
3
ridethepig | Fading The Highs In GBP!With Javid out Johnson had the perfect cherry pick with Rishi Sunak and now the fiscal taps can be turned on full. This medium-term swing is starting to look very interesting which is unlocking a leg towards 1.20xx and 1.15xx below: Rishi is a typical yes man, he will do whatever Johnson wants. Those behind the curtain know it was another flawless beheading from Cummings, meanwhile a ruthless Downing Street only waiting for Carney exit on 16th March to have full control with Bailey too. Eyes on NY selling the open, we could get a very fast swing down is USD catches a strong bid via coronavirus risk. US inflation overshooting will be enough to carry this lower. Thanks guys for keeping the likes and comments coming, jump into the discussion with your charts below!
Short
by ridethepig
13
GBPCHF what if reports are better then forecast/previous...??!!Sterling could be in for additional volatility as the U.K. jobs figures are due and might set the tone for BOE policy expectations. If the actual figures beat expectations, however, it could spark a strong bounce for pound pairs as this would likely dampen BOE rate cut hopes. The pair is floating around 38.2% Fibonacci retracement level, which coincides with an area of interest, weekly pivot level, and the 100 SMA dynamic inflection point. In my opinion, we may not see a further deep or retracement around 50-61.80% Fibonacci if we have a surprise better than the expected report where consensus is better then what it is hoped by the economist. The faster-moving MA is above the 200 SMA to indicate that support is more likely to hold than to break at the moment and also, stochastic is indicating oversold conditions or exhaustion among sellers, so buyers might take over soon but as we said everything depends on the upcoming outlook from the UK and global risk sentiment. The average daily volatility of GBP/CHF is around 82 pips a day so decide wisely entries and exit levels after knowing the reports. Stay careful friends!
by Anatta0
2
London Watchlist: Expecting a strong GBPSo... the UK data coming out today is pretty important, if bad it increases the chance of a rate cut by the BOE, but if positive it kinda kills it! So there should be pretty big movement on the GBP if the print is better than expected or worse thane expected! The video pretty much explains our thinking here and our trading tactic, we are long on GBPUSD and we are targetting the 120% mark seen on the chart on the right, a solid 100+ pip move! Right now the GBP is tanking, but thats just due to expectations of the analysts, who are rarely right and they don't even trade for a living, the charts say GBP is long and we will TRADE WHAT WE SEE ! If you like the video give us a follow!
Long
by PrimedGroup
Live Positioning in GBPJPY !!!A round of GBP chart updates after the latest cabinet reshuffle. A nice sweep of the highs and we are set to go with the fiscal taps set to rain down and attempt to offset the impact via brexit. On the other side we have risk taking the spotlight again with coronavirus flows not abating. JPY is set to outperform over the coming sessions with a soft selloff in global equities and with GBPJPY at the top in the range we are sitting at good value levels to recycle shorts. For the map: Highs 143.25 <=> Mid 142.25 <=> Lows 141.25 Expecting a red asian session with more risk clearing to be complete, I am taken back by how complacent that many markets have been able to try looking through the outbreak. We have a few reasons to remain on high alerts, uncertainty around the 2s5s: Notice how the inversions are ahead of recessions, while the press reports all is well there are downside risks building and playable across many markets. If we see an improvement in sentiment around the coronavirus I will lighten up. I will not be stubborn and hold on. Keep it simple and trade the driver! Don't forget to keep the likes and comments coming!!
Short
by ridethepig
1
ridethepig | GBP Market Commentary 2020.02.11A timely update to the FX strategy for GBP with particular focus on Cable. On the UK side, we have loud messages from Europe around the difficulty for both sides to reach an agreement by year-end. Although typical in a game of high-stakes chess, this is a heavy weight on Sterling. On the US side, a solid round of data prints last week from wages to non-agricultural employment. The FED remains dovish and in cutting mode, in normal circumstances cuts would be difficult to justify but with Trump in full control market expectations do not favour USD walking forward. On the technicals the map is crystal clear until we enter into the Brexit impact leg: Strong Support 1.276x <=> Soft Support 1.290x <=> Mid Point 1.328x <=> Soft Resistance 1.38xx <=> Strong Resistance 1.43xx On the positioning side, Pound longs were mostly built by speculators in the back-end of 2019 and these began to unwind as we headed into the official finish line in Jan 2020. This is leaving the flows exposed to negative headlines although you can argue the case for further upside as long as strong economic prints continue. The Pound is relatively cheap in this environment, I suspect the main impact leg from Brexit will not kick-in till October 2020 so we have plenty of time to continue working both side in the next 6 months. Expecting a mild recovery to come in the months ahead which will aid in offshore ownership of UK assets, the desire is there to continue the recovery and as long as this remains the case the breakdown will be difficult. Look to add GBP exposure on dips while we are at the bottom of the short-term and medium term range. A breakdown will be a game changer and will imply BOE are moving in August. A round of G10 FX charts and strategy updates coming over the sessions today... Don't forget to keep the likes and comments rolling guys!
Long
by ridethepig
1
GBPUSD: Market Outlook, Plan and Probabilities Future Price MoveU.K.’s first GDP reading, which is expected at 0.0% after a 0.4% reading in Q3 2019. If weak expectations then we could see GBP/USD drop below its 1.2875 weekly lows (weekly pivot s1 level) and maybe even make a run for the lower s2 or beyond. This is still possible given Cable’s daily ATR and its move so far today. If today’s data dump allows the BOE to avoid the dove camp for a while longer, then Cable could revisit its 1.2970 broken support before submitting to other economic catalysts. Speaking of, Fed’s Powell will talk economy in D.C. during the U.S. session. He will likely repeat the Fed’s growth optimism and concerns over low inflation but traders will also want to hear about the impact of Coronavirus and maybe his reaction to Trump’s latest calls for lower interest rates.
by Anatta0
GBP/USD forecast /post BOE/BREXITGU is technically cooking next move after a bit longer period of consolidation after 2 upward legs which created this new bullish trend from weekly support. Dollar paired some losses since October while GBP used that opportunity with combination from positive tones for Brexit. This week we will also get BOE rate decision which will definitely increase volatility on the markets due to almost even chances of cut-hold decision chances. Market is more sensitive and cautious since 'Coronavirus' fears which sent market into more risk-off causing dollar and safe havens to appreciate vs risk currencies. Also post brexit trade talks will be interesting to watch and it is still difficult to fundamentally forecast longer term Sterling direction. However, in such situation technicals and banks positioning is worth to watch. We are still bullish on pound and support looks good so far, not breaking down to create lower lows! For good r/r ratio I will take my chances going long on bullish overview. One of the rare times I disagree with sentiment with small stake, but good plan! If drop happens, I will look to re-enter lower.
Long
by fxmonarchy
GBPAUD waiting for the break of the rangePrice again testing the upper trend line after a false break from election period. Upcoming week is key and all attention on UK Brexit conclusion. Boris finally pushed his Brexit plan and on Friday 31st UK is leaving the EU. Also on Thursday we have BoE, Carney's last meeting, with various call from board members to potentially cut the rates to boost the economy. 2019 had the slowest growth since 2012 and some members already expressed dovish outlook on the rate decision. So lots of fundamentals this week for GBP. Technical range in the comments shows that a breakout trade is likely here. Good Luck!
by Antonio_trader
3
ridethepig | GBP Market Commentary 2020.01.14The power to breakdown has been developed knowingly and systematically, unlike chop/consolidation which frequently occurs. The effect of the breakdown is heightened by BOE turning very dovish and calling up for Sterling devaluation, which in their eyes must be required for offsetting the loss in UK market access. Compare the following two diagrams: Sellers step in on the election day as expected with a strong barrier. A sweep of the highs. Can sellers maintain the breakdown? In the first, the test of 1.35 sent buyers wandering on grounds of an orderly Brexit, depriving sellers valuable resistance. However, it was dangerous for buyers to carry on because the eye of Brexit is on it. After a Johnson majority came the selloff and now the attempt by sellers to reinstate the strategic breakdown which was previously broken is powerfully gaining momentum from the monetary side. Should we get the breakdown, the move will be fast as the insurance cut from BOE will not last beyond May. Bailey starts in May, it will take some time for the Johnson/Javid fiscal taps to work its way into the MPC forecasts meaning another late 2020 cut is then on the cards (not in play with this chart as will unlock 1.15). To put simply, a dovish BOE and hard Brexit will keep rates in the lower bound and QE infinity will return in 2021. For the immediate term, market clearly caught on the wrong side; 1.290x is next followed by 1.277x. Very difficult to get constructive on UK markets with BOE turning dovish. On the EURGBP side: Good luck all those on the sell side in Cable and other Sterling crosses, a lot of meat left on the bone. As usual thanks so much for keeping your support coming with likes, comments and etc.
Short
by ridethepig
13
ridethepig | EURGBP Market Commentary 2020.01.10By now there should be no surprises with BOE coming out on the wires at the 0.853x which was BOE stress level on the cross via Hard & Extreme Brexit scenarios (both still on the table). On the Euro side, selling has started to run out of steam and here the choice is between a breakout or more inside range trading. The first allows bulls to take charge once more; though the second allows room for more loading in the medium-term Pound shorts. We are getting closer to protecting the highs in Pound by inserting heavy support in EURGBP and protecting the lows; here the natural targets come in at 0.872x with extensions 0.90xx and 0.95xx for those trading the macro swing. The following well-know chart was played out before in EURGBP and this is no less imaginative: We shall close this chapter with a really unnatural looking move, this theatrical gesture from Carney yesterday - I mean has worked; Pound bulls want to refute it forthwith, but so far it is turning out to be very difficult. Eyes on the Pound flush for Brexit impact. Thanks as usual for keeping the likes and support coming, drop a line with any ideas or charts...
Long
by ridethepig
ORBEX:CHF Firm Despite Haven Flows,Pound "Stimulated" by CarneyBOE's Gov Carney hinted to stimulus yesterday, indicating that the pound could come under severe pressure if incoming data show no improvement. Coincidently, the same day there were suggestions that the EU-UK talks could be dragged past the tight deadline BoJo has set. The passenger plane crash in Tehran didn’t reflect into the markets as uncertainty about the crash remains high without access to the plane's "black box". As a result, #safehaven outflows continued to weaken the #yen. However, #franc seems undeterred by the sentiment, making a strong case for more firmness. Timestamps USDCHF 4H 01:25 GBPUSD 2H 03:35 Trade safe Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice
by Orbex
ridethepig | GBP Market Commentary 2020.01.09A good time to update the Cable chart as we approach the first macro driven event risk of the year with NFP. As mentioned a few times the range we are trading is crystal clear with 1.33xx highs and 1.31xx lows. While the market is holding the key support at the lows, I maintain a view that a correction back towards the highs is both corrective and necessary to allow positioning for Brexit impact leg while the risk to the thesis comes from a break below the lows in the range and reassessment is only required should we break below. I therefore look to sell the strength back towards 1.33 - 1.35 which will be enough to cap the highs for 2020. Should we see any strength extend in the short-term it will be a superb selling opportunity for those interested in adding weight to the in-house macro view. For those wanting to track the large swing we have been trading since the UK elections I would recommend the following diagrams: GBPUSD GBPAUD EURGBP UK markets pricing a Conservative majority as a "positive resolution" to Brexit is complacent and allows us an opportunity to capture those out of position and mis-pricing UK market access beyond 2020. To date we have traded a tremendous amount of conjecture around the Brexit chapter, yet many are quickly to forget we are yet to trade the "fact" leg. ...Best of luck to all those looking to trade NFP, a clean and simple spike back to the top of the short-term range in play for Cable. As usual thanks for keeping your support coming with likes and comments !!!
Long
by ridethepig
3
ORBEX: Trump LOST Round 1 of Impeachment Battle!Trump was impeached yesterday and lost! But the trial timing remains in doubt, keeping parties on their toes! Meanwhile, BoJ kept interest rates unchanged overnight and now we have to wait and see if BoE adds to the downside risks on #no-deal fears, or encourage bulls with a rather hawkish stance? I talk about all that in today’s market insights while analysing watch-listed FX Minors that move (hint: Loonie)! Timestamps GBPAUD 4H 02:30 CADJPY 4H 03:45 USDMXN 4H 05:40 Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice
by Orbex
ridethepig | GBP Fast Flows A very simple trigger for those wanting to cover some shorts from the initial elections entry; the key 1.315x support is holding and pressure has been completely absorbed. We are trading the bottom of the clearly defined range from the elections; 1.315x <=> 1.355x and markets rather than going overboard on risk will want to keep their cards closer to their chest until 2020. If we do lose 1.315x this will trigger a panic leg and immediately put us into impulsive territory in the macro chart below. Macro prints today from the UK were better than expectations and will be enough to keep BOE on hold and unlocks another test of 1.35xx. I will continue to use this pivot to position for the long-term flows: A perfect double top in the making? Smells like it... Thanks for keeping the support coming with likes, comments and questions. This is for advanced traders only as we are using the short-term range to decrease risk and scale into our position for a long-term trend . As usual with any questions feel free to open below.
Long
by ridethepig
2