FOREX ANALYST PICKS
FOREX STRATEGIST
JOEL KRUGER
My pick: Short New Zealand dollar against the US dollar at $0.7350
Expertise: Classic technical analysis
Average time frame of trades: 1 week-6 months
Despite the latest surge, the market shows some formidable resistance on rallies above $0.7300 and we continue to like the idea of fading Kiwi support at this psychological barrier. Longer-term technicals also confirm a bearish bias, with the market likely to roll over in favour of some deeper setbacks towards $0.6500. A daily close below $0.7250 should accelerate declines towards the initial support of $0.7000, which could then reach our $0.6500 objective.
FOREX STRATEGIST
JOHN KICKLIGHTER
My pick: Long dollar-yen above ¥88 and long euro-yen above ¥113.50
Expertise: Fundamental and technical analysis with risk management
Average time frame of trades: 1 day-1 week
I am sceptical of the EU stress test results that were released last week and I don’t think the advance in risk appetite will last. Nonetheless, the market will go where it will; so I will maintain my position for a potential euro-yen break above the ¥133.50 level, with a stop at ¥111.15. I will target ¥117. Another position I like is a long dollar-yen, which looks ripe for a reversal and is more risk neutral. I will look for a bullish dollar break above the ¥88 level, with a stop at ¥86.60.
FOREX STRATEGIST
ANTONIO SOUSA
My pick: Buy Aussie-dollar at the market rate
Expertise: Global macro,
Average time frame of trades: 3 months
I expect higher-yielding commodity currencies to continue to outperform after the release of better-than-expected second quarter earnings reports in the US triggered a shift in investors’ sentiment towards more risk taking. In particular, I expect the Australian dollar to gain further against the Japanese yen due to the interest rate differential, which is likely to grow since the Japanese economy remains plagued with deflation.