My pick: Long dollar-yen above ¥77.75
Expertise: Fundamental analysis with risk management
Average time frame of trades: 1 day to 1 week

Conditions are not very favourable for intermediate swings for either euro or dollar-based pairs. For the euro, the progress of the region’s crisis is a constant battle between market fears and policymaker manipulation. On the dollar side, we have the possibility of QE3 from the Fed next week. Should sentiment and fundamentals develop, I would still like a true dollar-yen move above ¥77.75. Otherwise, I’ll be sticking to setups that develop session-to-session.


My pick: Sell euro-dollar at $1.4000
Expertise: Technical analysis
Average time frame of trades: 1 day to 1 week

A closer look at the monthly chart shows a progressive decline, with the market in the process of carving a series of lower tops and lower lows. The clear break below $1.3835 reinforces the potential for the carving of the next major lower top below $1.5000 and opens the door for a more meaningful decline towards $1.2000 over the coming weeks. In the interim, look for any rallies to be well capped below previous support turned resistance in the $1.3835-$1.4000 area. Sell at $1.4000 for $1.2000. Stop at $1.4650.


My pick: Stay short euro-dollar
Expertise: Global macro
Average time frame of trades: 1 week to 6 months

I sold euro-dollar at $1.4328 on 29 July, expecting the EU debt crisis to weigh on the euro, while an increasingly anaemic global recovery boosts safe-haven demand for dollars. Prices met my initial objective at $1.3976, stalling at the bottom of a falling channel connecting major lows since mid-April, with a hammer candlestick hinting an upswing ahead. I will move my stop to the break-even level, continuing to hold short, expecting the near-term move higher to offer an opportunity to add to the position.