DailyFX: Analyst picks

CURRENCY STRATEGIST
CHRIS VECCHIO

My pick: Long dollar-yen
Expertise: Fundamental and technical analysis
Average time frame of trades: A few hours to a few weeks

Neither the euro-dollar nor the dollar-yen are behaving as desired, but of the two the dollar-yen is acting more in-line with what’s been expected. Last week I was waiting for US Federal Reserve events to pass; no daily close above ¥98.70 was achieved in dollar-yen. I’m now looking for a close above ¥98.80 by Wednesday to look for gains in the end of the week. Further weak US data will hurt this case. If US data is weak, I prefer playing yen weakness through sterling-yen.

STRATEGIST
ILYA SPIVAK

My pick: Long Aussie-dollar
Expertise: Global macro
Average time frame of trades: 1 to 6 months

The Aussie dollar’s corrective recovery looks likely to resume. Stabilisation in Chinese economic news-flow has reflected positively in the Reserve Bank of Australia policy outlook, with priced-in expectations no longer calling for further easing over the coming 12 months. Meanwhile, the latest data shows record-high net speculative short positioning has started to cautiously unwind. I entered long at $0.9190 two weeks ago and will continue to hold the trade, aiming for an initial target at $0.9640. A stop-loss has been set to trigger on a close below $0.8847.

CHIEF STRATEGIST
JOHN KICKLIGHTER

My pick: Long Aussie-dollar, and short euro-Kiwi and euro-yen
Expertise: Fundamental and technical analysis
Average time frame of trades: 1 day to 1 week

This past week, congestion prevented my setups from triggering. However, it is worth waiting for a good trade to unfold, rather than force something that isn’t there. This week, I’m looking at euro-yen as a wedge reversal if it breaks below ¥131.70. A diametric risk option is Australian dollar-dollar, above an inverse head-and-shoulders neckline at $0.9250. Less risk bound, euro-New Zealand dollar has moved 850 pips in a week to range resistance at NZ$1.7200. I’ll look for a break below NZ$1.7000.