EUR/USD trong daily closing last Friday and strong upward momentum suggest that the upward pressure is incomplete, argues UOB Group. "The break above 1.1255 late last week has shifted the outlook for EUR to bullish with a target of 1.1475," UOB projects."In order to maintain the current nascent momentum, any pull-back should not move back below the break-out level of 1.1250/55," UOB adds. the source
US Dollar - "We are thus headed into another week of uncertainty for the US Dollar, S&P 500, and other key assets. It is worth noting that FX volatility expectations have fallen for the week ahead. Yet it’s likewise clear that a bumpy Sunday market open in China, Japan, and other key markets could change that in a hurry. A US holiday on Monday the 7th may make for relatively illiquid market conditions, and caution is advised on what could be another challenging week for FX traders." ...
Why volatility is bad news for investment banks Recent market volatility isn’t good news for investment banks, JPMorgan’s Kian Abouhossein and team argued, and leaves Goldman Sachs and Morgan Stanley near the bottom of their pecking order. They explain: "Although volatility is good for investment banks, recent market turmoil has led to a spike in market volatility (avg VIX +100% since 15 Aug) which poses some residual short positioning risks such as correlation. Generally ...
Markets now believe Federal Reserve won't rise rates until 2016, and this is what experts are talking about: Economists at Barclays - expectation of a Fed rate rise to the first half of next year: "Given the uncertainty around the current global outlook, the timing of the rate hike seems more uncertain than usual. Should this episode of financial market volatility prove transitory, the FOMC could raise rates in December. On the other hand, ...
"While our economist Michelle Girard thinks the Fed may disappoint on giving a “firm” signal, which would fit with their data dependent outlook, she sees a risk that the FOMC minutes begin to put a greater emphasis on the pace of hikes being gradual. A clear discussion along those lines may be a “soft signal” that an earlier start to rate hikes, giving more assurance that a gradual pace can be taken, is the preferred path of the FOMC’s majority."" ...
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