Peter Chia, FX Strategist
[email protected]
Global Economics & Markets Research
Email: [email protected]
URL: www.uob.com.sg/research
FX Pulse
Tuesday, 20 September 2016
Look To Short GBP/SGD
OVERNIGHT
The U.S. dollar began the week weaker against all G10
peers on Monday, with the 200-day MA in dollar index (DXY)
capping dollar advances.
AUD led the rebound in G10 against the USD, erasing Fri’s
decline to finish 0.6% higher at 0.7534. EUR/USD rebounded
off 1.1150 (200-day MA) for a second straight day, tested as
high as 1.1198 before closing at 1.1175. GBP/USD found
buyers emerge near key big figure 1.3000 to recover to 1.3030.
USD/JPY broke and sustained below ¥102 starting early
Europe, chopped between 101.58/93 before settling at 101.93.
China grabbed some eyeballs as it returned from a 4-day
weekend holiday with the PBOC intensifying intervention
efforts to curb bearish bets on the CNY – first by fixing the
CNY stronger instead of weaker, at 6.6786 per dollar, followed
by overnight CNH HIBOR rising to 23.7% from 7.95%, for
the highest rate since 12-Jan. In reaction, CNY strengthened
as much as 0.2% shortly after open to 6.6614 per dollar before
halving gains to finish 6.6685.
For the rest of today, the data docket remains sparse (no
regional data), expecting only August prints of German’s
producer prices, U.S housing starts and building permits.
Trading is expected to be more muted and confined in
recent ranges as market brace for key central banking
decisions in Japan and U.S tomorrow.
Our outlook for GBP/SGD has also turned bearish from
neutral, prompted by an outsized drop on Fri followed by a
close below the 50-day MA overnight. Currently at 1.7770, we
look for rallies towards 1.7850 to initiate a short position.
Daily Chart of GBP/SGD
Regionally, TWD made a rare debut to lead advances against
the dollar, jumping 0.7% to 31.44 per dollar matching an
equally impressive 2.8% surge in Taiwan stocks. USD/SGD
was resisted near 1.3700 for a fifth straight day before
tumbling 0.5% to 1.3617.
TODAY’S VIEW
Source: Reuters, UOB Global Economics & Markets Research
Today, BOJ starts a two-day meeting today. Given the
differing views on what the BOJ will deliver or not deliver
tomorrow, overnight at-the-money volatility for USD/JPY has
spiked to over 31%, implying break-evens of about 133 pips.
FX Pulse
Tuesday, 20 September 2016
1|P a g e
CURRENT FX PORTFOLIO
SPOT TRADE IDEAS
Entry Date
Position
Entry
Target
Stop Loss
Comments
MTM (%)
1.3660
1.3745
1.3550
-
(0.25%)
(1.3625)
Position
Entry
Target
Stop Loss
Exit Rate
Exit Date
Return (%)
Long AUD/SGD
1.0325
1.0480
1.0250
1.0250
13-Sep-16
(0.72%)
102.60
102.60
103.95
7-Sep-16
2-Sep-16
1.34%
2016 P/L (%)
3.92%2
OPEN POSITIONS
14-Sep-16
Long USD/SGD
CLOSED POSITIONS
Entry Date
9-Sep-16
30-Aug-16
1
Long USD/JPY
101.90
104.70
Target or Stop Loss levels which are revised today are highlighted in BLUE
OPTION TRADE IDEAS
Entry Date
Position
Entry Rate
Comments
MTM (%)
1.92%
(1.3083)
End-2016 1.2400 GBP/USD
forecast
OTM
(1.3040)
OPEN POSITIONS
20-Jul-16
6-mth 1.2400/1.3100 GBP/USD put spread
CLOSED POSITIONS
Entry Date
Position
29-Jun-16
3-mth bearish 99.00/102.50/104.00 USD/JPY
seagull
09-Jun-16
Buy 1-mth 0.9500 USD/CHF put
11-Feb-16
Buy 3-mth 6.5500/6.6500 USD/CNH call spread
20-Apr-16
Sell 2-wk 0.7700 AUD/USD put
15-Jan-16
6-mth 2x leveraged bearish 1.44/1.48 GBP/USD
risk reversal
22-Mar-16
Buy 2-wk 1.0330 AUD/SGD call
22-Feb-16
Buy 3-mth 1.4050 USD/SGD call with 1.4650
AKO
Sell 1-mth 0.6750 NZD/USD put with AKO at
0.6895
Sell 1-mth 1.2500 JPY/SGD put with AKO at
1.2170
1-mth bullish 111.00/112.20 USD/JPY risk
reversal
07-Mar-16
26-Feb-16
25-Feb-16
1
2
26-Jan-16
Sell 1-mth 1.0900 EUR/USD call
05-Jan-16
Sell 1-mth 0.6850 NZD/USD call
Entry Rate
Exit Rate
0.00%
(102.50)
0.88%
(0.9580)
0.68%
(6.5421)
0.52%
(0.7785)
0.00%
(1.4411)
0.63%
(1.0332)
0.45%
(1.4040)
0.85%
(0.6801)
0.96%
(1.2403)
0.38%
(112.16)
0.83%
(1.0855)
0.77%
(0.6747)
1.33%
(100.50)
0.00%
(lapsed)
0.00%
(6.5346)
0.00%
(exercised)
0.60%
(1.4230)
0.00%
(1.0305)
0.05%
(1.3610)
(2.83%)
(0.6600)
0.00%
(KO-ed)
1.25%
(113.43)
(1.05%)
(1.1015)
0.17%
(0.6522)
Exit Date
Return (%)
17-Aug-16
1.33%
11-Jul-16
(0.88%)
12-May-16
(0.68%)
05-May-16
(2.07%)
12-Apr-16
0.60%
05-Apr-16
(0.63%)
23-Mar-16
(0.40%)
16-Mar-16
(1.98%)
07-Mar-16
0.96%
29-Feb-16
0.87%
25-Feb-16
(0.22%)
11-Jan-16
0.60%
Shows only recently closed trades
Total for ALL closed trades entered since 4-Jan-16
Disclaimer: This analysis is based on information available to the public. Although the information contained herein is believed to be reliable, UOB
Group makes no representation as to the accuracy or completeness. Also, opinions and predictions contained herein reflect our opinion as of date
of the analysis and are subject to change without notice. UOB Group may have positions in, and may effect transactions in, currencies and financial
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