Three scenarios in front of the Fed and horses to ride…

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Quotable

“There is no danger of the public ever finding any key to the secrets of winning.  The crazy gambling urge and speculative hysteria makes that a certainty.  But if the public play ever did get wise to the facts of life, the principle of ever-changing cycles would move the form away from the public immediately.”

--Robert Bacon, Secrets of Professional Turf Betting

 Commentary & Analysis

Three scenarios in front of the Fed and horses to ride…

43340-coming-up-next-the-perfect-storm-for-the-us-dollar.jpg

As I sit in my office here in southeast Florida, I wait impatiently for the arrival of two pending storms—hurricane Maria (hoping the forecasts are correct this time) and Janet (aka the Federal Open Market Committee interest rate decision tomorrow).  Below are our three best guesses of what the Fed will do (couched as plausible scenarios) and associated currency trade ideas.  READ MORE...  

Comment

Copper Leading the Australian Dollar?

We are long AUD/USD and looking forward to the pair playing some catchup with copper prices.  The chart below compares weekly copper futures prices to the AUD/USD spot price.  Copper has moved above a key intermediate-term swing resistance level; Aussie has not.  The bottom pane of the chart shows the 10-year benchmark spread between Australia and the United States.  The down trend line going back to 2010 has been broken. 

090617 aud and copper.png

Comment

Is a change in cycles & global macro era may be upon us? If so, commodity currencies look cheap.

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Quotable

And so, from hour to hour, we ripe and ripe.
And then, from hour to hour, we rot and rot;
And thereby hangs a tale.

--William Shakespeare

Commentary & Analysis

Is a change in cycles & global macro era may be upon us?  If so, commodity currencies look cheap.

Back on 5 July 2017 we shared a chart comparing the relative movement of stocks (S&P 500 futures index) to commodities (Reuters CRB index) and said then...

081917 stock comm ratio current.png

...So, longer term cycle analysis suggests a turn in the relative performance of both the dollar and commodities may be upon us.  An accelerated power shift to Asia could be the major global macro driver....READ MORE

Comment

AUD/USD Rally to key Fib Retracement...

Interesting, yesterday's rally to the 61.8% retrace level...watching the hourly/30-min chart for a three wave move lower from this swing high at 0.7962....

Aussie job news - a mixed bag: 

SYDNEY, Aug 17 (Reuters) - Australia's jobless rate ticked lower in July led by a big bounce in part-time work while full-time employment fell, a mixed result that augurs poorly for wages growth and the course of inflation.

The unemployment rate slipped to 5.6 percent from an upwardly revised 5.7 percent in June as 27,900 new jobs were added, the Australian Bureau of Statistics said on Thursday.

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