Arguments for ECB to hike in 2010 by Danske Bank
* The focus of the ECB now appears to be shifting from whether to implement more stimulus measures to when to begin withdrawing them.
* We believe that the euro area next summer will have recovered so much that the ECB will consider interest rates at historical lows as being inappropriate and will start hiking.
* When the ECB starts hiking it will probably deliver about 0.5 percentage points each quarter, which was the average hiking speed seen in the 2000-01 hiking cycle.
* The exit strategy is likely to begin with alterations of the conditions for the long-term refinancing operations.
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o The latest IMM data shows that net long USD positions were scaled back significantly in the week from 7 to 14 April.

o Speculative investors have reduced their bets that GBP will depreciate. Net short GBP positions were trimmed by USD0.7bn following strong GBP performance in recent weeks. During April, GBP has gained close to 5% against EUR and close to 3% against USD. While reduced, net short GBP positions remain significant and there is thus still the potential for a move higher in GBP/USD to be catalysed by position unwinding.

o Long positions in AUD and NZD were built further, while net short CAD positions were reduced. Both AUD and CAD continued their recent strong performance during the week to 14 April, while NZD underperformed against the other dollar-block currencies.

o Net long EUR positions were also extended, though positions are still modest by historical measures. The euro has seen broad-based pressure since the IMM data was collected on 14 April.

o Speculative investors are net long in AUD, EUR and NZD against USD, while net short in GBP, CAD, JPY and CHF against USD.
Speculative investors scale back long USD positions

When you have some spare time, give it a look… It is always wise to have fundamentals in mind when trading…

Economic and Financial Outlook, 2009 Q2 by Danske Bank

Francesc

Hope they are right….

Global Scenarios - Moving away from the abyss by Danske Bank

Francesc

Too late my friend….

ECB to cut 50bp again in April by Danske Bank

Francesc

Could this change the view of David Solin that EURUSD is getting close to a large upmove towards 1.4715?

EUR/USD: Reserve balancing by Russia likely to add downside pressure on EUR/USD by Danske Bank

Francesc

Interesting…

EUR/GBP Bearish trend resumed by Danske Bank

Francesc

Hi everyone

I’m very please to let you know that Danske Bank - one of the most important content provider at FXstreet.com - has just been nominated as “Best FX Research and Stratgy” by the magazine Technical Analyst.

Winners will be announced at the Awards Ceremony on 12 March 2009, at the Sheraton Park Lane in London.

I’m very happy for that nomination as reinforces our view that Danske Bank provides top quality research worth to be promoted at FXstreet.com.

Also, I must congratulate Dave Floyd and Julien Heiderscheid as their companies Aspen Trading and Trading Central have been nominated too for Best FX Research and Strategy along Merrill Lynch and PIA First.

Both Aspen Trading and Trading Central are content providers at FXstreet.com

Congratulations all!

Francesc

Since end of October EURUSD has been trading in a range between 1.2330 and 1.3100. That range was
broken this morning when EURUSD took out its November high at around 1.3081. A new bullish trend is established with a year end target of 1.3808 which is a major resistance area. If broken there is room for a
move to 1.4140 (minor resistance) and 1.4700 which is next major resistance area. A trough below 1.2550
reverses the trend.
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Hi everyone

An update of the Financial crisis we are all suffering

Financial crisis update by Danske Bank
• The financial crisis has changed its focus away from fears of systemic risk in the financial sector and toward the economic consequences of the crisis. 

• For a long time the main issue for banks has been constrained access to funding markets. After a series of central bank and government initiatives, banks largely now have access to (short-term) funding. As the negative impact of the financial crisis is now being felt on the real economy, the focus has turned to the capitalisation levels of the banks.

• US dollar money markets have improved, but show little progress in Europe. We doubt that BOR-OIS spreads will show much improvement in euro terms until next year.

• The Fed continues to take drastic measures to combat the credit crisis. The escalation of quantitative easing with purchasing direct obligations of GSEs and mortgage-backed securities has caused a steep drop in US mortgage yields. This will probably cause a wave of refinancing and the US housing affordability index is heading for an all-time high.

• Emerging markets have been severely hit recently and more may be in the pipeline. Unwinding of carry and dwindling risk appetite is hitting the most imbalanced markets the hardest.

• The economic fallout from the crisis is increasing and the economic outlook appears very dire. A global recession is on the cards. We have the bulk of real economic losses (rather than the marked-to-market losses that have dominated so far) ahead of us, as unemployment and delinquencies surge higher.
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