USD/JPY is hesitating on its way up and AUD/USD is feeling relatively comfortable in the current trading ranges.
What is the next move? Natixis calling to sell any bounce on the Aussie and to sell any dip in dollar/yen. What do you think?
Here is their view, courtesy of eFXnews:
In reaction to the a series of indicators that confirmed the strengthening of US growth, the US dollar extended its rise against most G10 and emerging currencies, notes Natixis.
“…There is nothing standing in the way of a monetary tightening by the Federal Reserve come mid-2015. The US 2-year rate is back at its highest levels of September at 0.54%, and can be expected to extend its rise. And although the US 10-year rate has also risen, it is only at 2.40%, which is 20bp below its September high.
“In short, the overall environment remains favourable for the US dollar. That can be seen in the significant positions held by speculative accounts, to the point in fact when the currency is starting to be overbought. The DXY dollar index has broken above 88 and we see it appreciating further to 90-91 in coming months,” Natixis projects.
In line with this structural bullish USD view, Natixis advises clients to use any USD/JPY dips to enter long positions targeting 117.90.
Same for AUD/USD, where Natixis advises selling bounces targeting a move to 0.8480.
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