Morning Report: 07.00 London
- Risk appetite returned yesterday across markets, but pressure still remains. US data was mixed, but manufacturing appears to be stabilising, helping the US dollar to reverse some of the yesterday’s losses.
- The Japanese yen saw a big intraday swing, with most yen pairs correcting at least half the losses experienced before 6AM. Those yen pairs are creeping lower again this morning.
- Oil prices, in particular, have felt the reversal with big losses yesterday.
- The EUR/GBP is unchanged so far after the pound reversed early losses yesterday.
Coming up today:
- Coming up today we have Canadian core CPI at 13.30, with US building permits and housing starts at the same time.
- ECB president Draghi then speaks at 16.00.
Trade Idea:
- The oil-heavy USD/CAD has risen steadily this week as oil prices come off the boil. The fate of oil still remains unclear, but at least we can say that the consistent bear trend is over.
- If anything, we’re more likely to see continued flip-flop trading which could mean another downswing to the USD/CAD over the next 14 days.
- A good way to play this is a LOWER trade predicting that the USD/CAD will close below 1.28 in 14 days for a potential return of 150%.
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