Get started

Positioning

Does the Canadian dollar have a bullish surprise up its sleeve?This is the question I am asking myself as we head into 2025. CAD has been the weakest major for some time now based on the BOC's easing cycle, and we saw a record level of net-short exposure against it in August, and another surge of shorts in November. This strikes me as a stale trade that is vulnerable to a shakeout, and it might not require a particularly large catalyst for CAD bears to capitulate and send USD/CAD lower. MS
Short
by CityIndex
Watch out as EURGBP net short positioning is reversing quicklyLeveraged money net positioning is reversing from extreme short levels in EURGBP futures. We do acknowledge the UK's recent positive political momentum amid political turbulence in the EU, however we believe the effect is in the price. On top of that, our fundamental macro model is slightly bullish EURGBP, certainly not indicating a further drop from these levels. This might indicate a rally in EURGBP towards 0.86 after a recent 2 standard deviation selloff.
Long
by bearwhispering
$GOLD Index - Q3/2023 *3M (Quarterly) Looking at TVC:GOLD on the 3M(Monthly) Tf(Time-frame) from an investor perspective view of positioning; (long-term investing on the yellow stone) we can see it sitting at no men's land at the current price, as well Changing Character and Breaking Market Structer (Lower Low) in price action ; (Lows of Q2) Despite its Bearish Price Action on *3M , States and Central Banks around the World have continued accumulating, spreading wide their balance sheets in-to TVC:GOLD Reserves . And so have done many another States, including 2 out of three Global Superpowers of China ECONOMICS:CNGRES and Russia ECONOMICS:RUGRES
TVC:GOLD
by Mr_J__fx
2
EUR/USD -Macro Resistance $EUR/USD is about to come in to contact with a Macro Resistance Trendline @ 1.13151$ One must beware and very careful when it comes in to looking for Buying Opportunities when breaking down the technical analysis on smaller time frames. With TVC:DXY reclaiming last week the broken Big Range of 100-105 zone, it appears so that with uptrend continuation of TVC:DXY , Euro tends to bleed. () Not to mention above else, that Fundamentally, Euro-Zone is not looking as promising to support EUR currency against TVC:DXY TRADE SAFE *** Note that this is not Financial Advice ! Please do your own research and consult your own Financial Advisor before partaking on any trading activity based solely on this Idea
Short
by Mr_J__fx
Stocks, Rates and Inflation: Assessing Risks and OpportunitiesOver the last year, there have been increasing concerns about threats to the US and global economies, mainly due to all the rate hikes from the Fed and other central banks. However, these fears have definitely not played out, as consumer spending and business hiring have shown surprising durability in the US, despite rate hikes and inflation. Several factors explain the stock rebound since mid-2022: - Bearish positioning left room for a short squeeze as negative expectations didn’t play out at all. Attention has returned to quality large-cap technology firms leading in AI development like Google and Microsoft, as their innovations promise productivity gains that support growth. - Ongoing passive investing inflows, corporate buybacks, past fiscal stimulus, and excess savings, the Fed and Treasury generating shadow liquidity, China and Japan keeping rates low and stimulating, the massive deficits of the US government (investors know the US is essentially ‘broke’). - Inflation coming down is also boosting stocks, as stocks are mainly valued based on inflation, not interest rates. - The Fed might have finished its hiking cycle or might have one last hike left. Current rate expectations are indicating that rate cuts will come by early 2024. While earnings seem to be plateauing from peak levels, profitability remains healthy overall. GDP growth remains positive and revised higher, the US economy keeps adding jobs and the unemployment rate remains at record lows. Global challenges persist, as supply chain disruptions and inflationary pressures from the Ukraine war might come back at any time, despite having significantly subsided. Demographic trends of aging populations in developed countries also drag on labor force expansion and economic growth. High debt loads worldwide likewise limit stimulus options without leading to inflation or instability. While inflation has moderated, it remains elevated and sensitive to many factors, from geopolitical instability to climate change. More concerning, inflation has eased without a clear link to the Fed’s policy tightening. It’s improbable that the Fed hikes were the ones that pushed inflation from 9.1% down to 3%, as rate hikes act with long and variable lags. This is raising doubts about the Fed, it's forecasting, and its monetary policy’s effectiveness in controlling inflation over the long term, especially as their current super-tight interest rate policy could lead to catastrophic deflation and recession. Given rising recession risks, the Fed will likely be forced to reverse course and start cutting rates by the end of 2024. This policy whiplash carries risks of its own, as we currently seem to be heading toward a deflationary shock, which might be followed by another inflationary wave. With massive deficits, the Fed also faces constraints from high-interest costs on debt even as its policies try to restrain growth and inflation. The economy isn't a simple dial the Fed can turn on and off. What’s even more concerning, is that the Fed is essentially trying to suppress wage gains and cause unemployment to curb inflation, which is something that could induce an inequality-worsening spiral. In our opinion, a more balanced approach recognizes that moderate wage growth won’t spur runaway inflation, especially as technology evolves work. The policy should prepare workers for automation and AI through training programs, not just reactively responding to lagging data as it is currently doing. The Fed’s constraints highlight the need for creative solutions to complement monetary policy. The economy is a multifaceted system requiring diverse policy responses. With vision and flexibility, emerging technologies like AI have immense potential to broadly uplift living standards. But this requires inclusive policies and acknowledging the economy's dynamism. The future likely holds turbulence, but with strategic foresight productivity gains can be harnessed for the benefit of all. Despite concerns over rising rates, the fundamental backdrop remains favorable for stocks. Many investors have grown excessively bearish and underestimate the market's upside potential. Sentiment and positioning remain bearish and cautious, with most investors underestimating all the positive headwinds for stocks, especially productivity gains from AI, falling inflation, falling rates, and currency debasement. Crucially, the rally since mid-2022 has not been fueled by leverage, unlike past bubbles. Margin debt levels decreased last year, reducing systemic risk. The market has a strong foundation to build on gains, especially as most unprofitable tech has been clobbered and hasn’t recovered, unlike US tech behemoths. Big tech and AI stocks are leading the way higher, forming a new monopoly built on network effects and immense scale. Their nearly unassailable competitive advantages will drive growth for years to come. Although in the short-term sentiment has turned bullish, hence a 10% correction is possible, we don’t think that a new bear market is in the cards until stocks make new all-time highs. In conclusion, while risks remain, the US economy has proven resilient amid rate hikes and inflation. Productivity gains from AI innovations, coupled with prudent and flexible policymaking, can support continued growth and market gains if properly harnessed. Investors should look through short-term volatility and maintain a constructive long-term outlook.
TVC:DXY
by BitcoinMacro
$USD/CHF - Bottom of Range Bound *M- $USD/CHF has been trading inside a range bound from basically since 2012. Past two months, price action came very close to testing the Lows of printed on January 2021 at 0.87576$ At the current Monthly Candlestick, Price its breaking out from a Falling Wedge (bullish pattern). Its measured move would put $USD/CHF at 0.97$ There sits a great opportunity to Buy $USD/CHF from here, while stoploss can be adjusted in different ways depending on your trading style and your risk appetite . (we'll zoom in more for market structure on smaller tf) Bounce to at least 20 & 50 EMA is highly a probable outcome, conflicting as well with a test of the nearest S/R area. TRADE SAFE ***NOTE that this is not Financial Advice . Please do your own research and consult your own Financial Advisor before partaking on any trading activity based solely on this Idea
by Mr_J__fx
$USD/JPY -Giant Bearish Flag *W- Awaiting Change of Character (CHoCH) for $USD/JPY on *W tf (weekly time-frame). Market Structure looks healthy in terms of Higher Lows on smaller time frames (1-4hr) Decent probable Shorting opportunity in case $USD/JPY fails CHoCH. Shorting opportunity on Resistance Trendline of Bearish Flag Pattern on *W is perfect. Pullbacks to at least 20 EMA *W + S/R zone. Volume is aswell below average on *W Price seems over extended for now despite The Uptrend Market Structure on smaller time-frames (screenshot attached at comment section)
by Mr_J__fx
Fundamentals favour soybean, sugar and wheatAgricultural commodities, led by grains rose sharply in 2022. The two main catalysts for the upside in price were the Russia-Ukraine war alongside other supply challenges. There has been a number of cascading events around these two catalysts involving government interventions globally as food prices soared. However, from mid-October the renewal of the Black Sea grain initiative for six months, helped quell concerns of access to Black Sea ports. We have seen prices decline since then, but from a high level. It’s worth noting that grain exports from Ukraine under the Black Sea Grain Initiative dropped to 3.1mn tons in January compared to 3.6mn tons in December 2022 owing to a slowdown in inspections1. In 2023, the supply demand balance appears to be favouring soybeans, wheat, and sugar. Extreme drought in Argentina lends a tailwind to soybean prices In the case of soybean, a gloomier supply outlook has been a key tailwind for prices in 2023. Argentina, the world’s third largest soybean producer, is expected to see a weaker crop at 35.5mn tons owing to persistent drought and high temperatures. The Foreign Agricultural Service of the US Department of Agriculture (USDA) estimates the crop at just 36mn tons after the USDA previously predicted a crop of 45.5mn tons. However, both estimates are still well above the assessments of local experts. The Rosario Grain Exchange, which asserts the drought is the worst in 60 years, lowered its soybean forecast to 34.5mn tons. Thus, future downward revisions by USDA are quite likely which should help soybeans continue to find support. Net speculative positioning in soybean futures has increased 124% since the start of October underscoring the positive sentiment owing to the tighter supply outlook. Tighter supply on the global sugar market Sugar prices are trading at a six year high. Investors remain concerned over the prospects of the sugar crop in India, the world’s second largest sugar exporter. Sugar cane processing in Maharashtra, the most important growing State, could end 45 to 60 days earlier than last year owing to heavy rainfall that has reduced the availability of sugar cane. In 2022, sugar production reached a record 13.7mn tons, which allowed India to export a record high 11.2mn tons of sugar.2 The Indian Sugar mills Association (ISMA) revised its estimate for domestic sugar production lower from 36.5mn tons to 34mn tons for the 2022/23 season2. This is raising concerns that the Indian government will not approve any further sugar exports for the current marketing year owing to the recent reports of weak production. This does suggest a tighter global sugar market particularly as we are in the midst of Brazil’s (the world’s largest sugar producer) sugarcane off-season. Although Brazil produces sugar all year round, during this period (December to March) few mills continue to crush. Supply from Thailand, the world’s third largest sugar producer is unlikely to fill the gap left behind by the smaller Indian harvest particularly during Brazil’s off-crop. The front end of the sugar futures curve has been in backwardation over the past 3 months and currently provides a roll yield of 7.2% highlighting the tightness in the sugar market. Wheat most exposed to geopolitical tensions Wheat prices have under most pressure from the improved supply prospects from the Black Sea Region. However total grain exports have declined by 29% to 27.7mn tons in the ongoing season (from 1 July 2022 to 31 January 2023), with wheat exports down 42% over the prior year.3 The ongoing escalation in the Russia Ukraine war continue to threaten supply from the breadbasket of Europe. The US Department of Agriculture is forecasting a noticeably smaller Russian wheat crop of 91 million tons for 2022 in sharp contrast to Russia’s State Statistics Agency estimate at a record high of 104.4mn tons. According to the consultant firm SovEcon, the key growing region in the south of Russia has seen only around 40-80% of its normal rainfall over the past three months. The forecasts of this year’s crop in Russia are less optimistic. In the 2022/23 season, a record crop in Russia enabled ample supply of the wheat markets, despite a considerably lower crop in war-torn Ukraine in particular, thereby dampening prices. Lower supply is likely in the coming season, however, not only from the top wheat producers – Russia and the US – but also from Ukraine on account of the ongoing military conflict. The Ukrainian Grain Association (UGA) anticipates a crop volume of 16 million tons. According to the Ukrainian Agriculture Ministry, 20 million tons of wheat were harvested last year. Before the war, the crop had totalled around 30 million tons. Net speculative positioning in wheat futures is currently more than 2-standard deviations below its five-year average, underscoring the extreme bearishness on the wheat market. Amidst the ongoing conflict and lower wheat supply from Russia and Ukraine, wheat prices appear positioned for a rebound from current levels. Sources 1 Bloomberg as of 31 January 2023 2 Indian Sugar Mills Association as of 30 December 2022 3 Bloomberg as of 31 December 2022
CBOT:ZW1!
by aneekaguptaWTE
Moderating inflation could further reinforce gold and silverLet’s begin with a recap. In 2022, precious metals were down 4.4% when the S&P500 Index was down 19.4%. That is an outperformance of 13.8% for precious metals against equities. Still, many firm believers of gold were, at times, questioned why gold was not scaling new highs in a year when inflation was doing exactly that. As Nitesh Shah outlines in his model, gold is influenced by four variables. These are: 1. Changes in the US dollar basket (-ve relationship) 2. Consumer price index (CPI) inflation (+ve relationship) 3. Changes in nominal yields on 10-year US Treasuries (-ve relationship) 4. Investor sentiment measured by speculative positioning in futures (+ve relationship) Although inflation was supportive of gold last year, the aggression with which central banks acted to tighten monetary policy strengthened the US dollar and lifted Treasury yields creating headwinds for precious metals. As a result, investor sentiment was also weak (see figures 01 and 02). A shift in sentiment Although the Federal Reserve (Fed) has not yet signalled a dovish pivot, markets are beginning to expect this to happen at some point this year. With the US consumer price index (CPI) inflation falling for its sixth straight month in December and moderating to 6.5% vs 7.1% in November , this market consensus might be reinforced. Even if the Fed remains on its tightening path in the first half of this year, the pace of rate increases could slow down. If inflation figures continue to decline steadily and growth data has not become alarmingly worrying, the central bank may hold its rates at a terminal rate during the second half. Of course, the exact trajectory of these dynamics cannot be predicted. Still, however, market consensus is at least forecasting reduced hawkishness compared to last year. As a result, investor sentiment in gold has been on the rise since November. If Treasury yields and dollar continue to pull back, inflation moderates gradually, and economic data slowly deteriorates, sentiment towards gold as a safe-haven asset could continue to improve. The silver lining Silver often exhibits a leveraged relationship with gold. We experienced this in the twelve months after the March 2020 Covid crash in markets when silver meaningfully outperformed gold while both metals rallied. In 2022, things went in the other direction. As gold’s sentiment deteriorated, investor sentiment towards silver fell even further. And once again, gold’s recovery is enabling silver to bounce back even more strongly. Silver is, of course, affected by the dynamics of industrial metals as well given more than half of its demand comes from industrial applications. This was also a factor for its lacklustre performance last year as industrial metals were pricing in a slowdown in China and recessionary fears across major economies more widely. If in 2023, China’s lockdowns are lifted for good and the economic engine starts firing again, fuelled by accommodative monetary policy, this could be the catalyst for the recovery of industrial metals. It could also spur silver’s rally further. The risk to the view If the Fed takes markets by surprise and continues to tighten into the second half of this year, our base case could be challenged, and gold and silver may face newfound resistance. If the Fed signals such intentions early this year, say, in response to inflation numbers as they become available, these challenges could present themselves sooner. For now, it appears, that inflation is moderating steadily encouraging the markets to believe that so will Fed’s hawkishness.
MCX:GOLD1!
by aneekaguptaWTE
625 pip trade coming AUDUSDAUDUSD is getting ready for a massive move. We want to capitalize on this 625 pip move. This means we have to front run this trade by getting in it early and selling to the individuals who decide to come into the trade after we have. I proved 3 different trade targets for this trade based upon the 625 pip move - the 250 pip move and 100 pip move. we will hit all 3 time frames as we attempt to profit of the total 625 pip move. Lets end the year with one great trade!
Short
by RobinhoodFX
1
EUR/CHF Macro Analysis / Can 2020 make final low before reverse?Very interesting pair to watch, with huge macro potential to keep in mind! CHF has been one of the best performers this year and still keep strong. Mostly reasons are its safe-haven status which is in 'on' mode now due 'Coronavirus' crisis and SNB's new tag as currency manipulator which puts them on a close watch lately, so further CHF gains are opened even more. So SNB is keen on cutting rates to -1,00 in the response to a rising currency which in return hurts Swiss exports as the main reason for an economic slowdown. Any positive news on a recent virus situation will likely support the upward move, while market is still in focus for any news coming. ''Apparently, the Swiss economy has again adapted to a stronger franc and now can live with a firmer EUR/CHF exchange rate below 1.10, so the SNB can tolerate levels between 1.05 and 1.10 going forward!'' Currency manipulator status brought new franc buyers making currency 'overcrowded', and the negative interest rate carry reduces the attractiveness of buying are the main fundamental reasons (count on possible rate cut too) to expect CHF's rise to slow and or depreciate! EUR is the good counterpart currency to expect rise against CHF due to several technical reasons and secular performance. SECULAR ANALYSIS AND TECHNICAL ANALYSIS: Since November EURO has been the best performing currency by a secular analysis that measures single currency vs 'a type' of neutral asset providing more intrinsic value information for the single currency. My analysis is based on spot gold/currency performance. On the other hand, CHF is fairly 'overcrowded' to say at least! It matches my assumptions on the currency being very close to a turning point this year. If we take in consider technical factors and charts we can see 'Elliot wave' pattern potential completion anytime soon (the last impulse is expected to make the last bottom before reversal) at around 1.05-1.06 levels which are not that far away. The next 1-2 months are expected to be turbulent and any entry before clear pattern confirmation is not recommended! Risk/reward drawing is potentially a good one to consider, but not my final decision as we still wait for the bottom to be confirmed by either horizontal line pattern on candlestick pattern, or combination of both. NOTE: Fair value entry for bulls - 1.05
Long
by fxmonarchy
5
EURUSD Vs. Yields 10 - 5 years.High spreads between US10Y - DE10Y and US05Y - DE05Y, Can indicate some more downside risk for the euro. There is also some hidden divergence marked with green lines. European money is flowing into less riskier assets, as EU economic forecast have been slashed, while some banks are saying that the german economy is headed for a recession which is one of the largest economies in the EU. ECB´s ending of QE program have left the Central bank with less tools to stimulate the economy. A restart of the bond buying program will put questions on the politics taken from the CB and will place them in a situation where the market will think that they dont know what they are doing. If they choose to use some tools the only option they have is the "TLTRO" (Targeted longer-term refinancing operations) Which will give the banks some available liquidity to lend money out and push the economie for some growth. The risk of a possible recession in the EU can give some concerns if the CB will raise rates at Q4 2019. A slowdown in the Chinese economy will also affect the EU, as China is one of the biggest importer of the european products. At the same time IMF downgrades global economic growth, while U.S. economy also saw some downgrade of its growth forecast. I still see the U.S economy performing better than the European. Holding shorts on EURUSD - adding more at a break of 1.11060 with target at 1.0380 and 1.0600. Hedging from those levels and watching the price before going net long position. Break of these levels could result in a further move down to 0.9600. Closing of shorts, and entering long positions will be at 1.16700 with target of 1.21300
Short
by Fx-AlphaStrats
EURUSD fundamental swing trade shortWhat points to USD strength fundamentally: - Monetary policy: FED rate median is at 2.15% end of 2018 vs ECB expected to hike only 2019 Q4 -> carry on USD side - CB balance sheet: FED BS decreasing since 2017 May, ECB still rising, tapering expected in '18 Sept - Inflation: US Core inflation 2.1% and forecasted to 2.4% vs Eurozone 1.1% and moderate upward forecast Cons: - Citi WERM valuation: EUR undervalued by 20% (historically not outstanding) - CitiFX Global Flows: Real Money got net EUR buyer in June Risk-events ahead: - US inflation - June 12 - FED rate decision (hike expected) - June 13 - ECB monetary policy meeting - June 14
Short
by RobertSoos