Independent Strategy

Macro Matters

Technicals Category

Independent Strategy Blog: Macro Matters

Bit more currency volatility after the Easter break with the dollar starting strongly, moving to its recent highs in dollar index terms.  We're not quite at point of capitulation but if this move doesn't reverse it could finally deliver the long awaited bullish dollar break.

Currency's remain trapped in ranges, with no sign of any immediate break that could snap them out of these bounds.  The longer-term trends remain intact but these periods of consolidation can be lengthy before these primary drivers reassert themselves.  Overall it's still a strong dollar story.

Currencies have ranged for the past week, with dollar ceding a little ground.  But not enough to derail the overall dollar bull story.  Bond yields have tried to edge back but remain locked in longer-term downtrends which implies still lower yields.

Dollar has managed to rebound after failed move lower last week, but DXY still capped by the key 98.00 area.  That means euro remains under pressure, yen and Cable more finely balanced (for now). Bond yields fell to new lows but have backed off over the last few sessions.

A bit more FX volatility but nothing sufficient to derail underlying trends towards a stronger dollar, even if some decent support areas were temporarily breached.  Really this just suggests momentum is lacking and that trends might take a little longer to play out.

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