Fixed Income and Currency Strategist

Gautam Jain, PhD, CFA

FX & Rates

<p>We are not expecting the FOMC meeting tomorrow to be market-moving. Having said that, with the (negative) correlation between the US dollar and EM currencies the highest since 2012, any implications for the dollar from the meeting tomorrow would ripple through EM currencies. This impact is likely to get exacerbated by the rising correlations within the EM FX universe, which implies that we are currently in a "risk-on/risk-off" period.</p><p>Separately, the attached file is a snapshot of the EM currency market in which we seek to identify the leaders and laggards among currencies by comparing the performance of each to its history as well as to other currencies based on their respective betas to an EM currency index.</p>

We are not expecting the FOMC meeting tomorrow to be market-moving. Having said that, with the (negative) correlation between the US dollar and EM currencies the highest since 2012, any implications for the dollar from the meeting tomorrow would ripple through EM currencies. This impact is likely to get exacerbated by the rising correlations within the EM FX universe, which implies that we are currently in a "risk-on/risk-off" period.Separately, the attached file is a snapshot of the EM currency market in which we seek to identify the leaders and laggards among currencies by comparing the performance of each to its history as well as to other currencies based on their respective betas to an EM currency index.

FX Dashboard: Cross-Correlations Between EM Currencies Rise Sharply

Founder & Chief Market Strategist - SAV Markets, SAV Markets

Shyam Devani

Founder & Chief Market Strategist - SAV Markets

Technical Analysis

Korea Stock Exchange Kospi Index / Technical Analysis

<p>The Kospi Index has fallen back to key levels that must again be watched closely.</p><p>The rise in both <a href="https://www.smartkarma.com/entities/krw" target="_blank" data-smartkarma-citation="entities:22828:1" rel="noopener">KRW (USDKRW CURNCY)</a> and JPYKRW are early warning signs that there could be trouble ahead.</p><p>A break below 3,252 would be an initial bearish sign while a close below 3,220 would confirm that there is likely to be notable danger ahead.</p>

The Kospi Index has fallen back to key levels that must again be watched closely.The rise in both KRW (USDKRW CURNCY) and JPYKRW are early warning signs that there could be trouble ahead.A break below 3,252 would be an initial bearish sign while a close below 3,220 would confirm that there is likely to be notable danger ahead.

<p>In our monthly trade ideas recap note, we provide a performance update of the trade recommendations in FX and rates that we make on a weekly basis and discuss those we closed last month. We have made a total of 18 trade recommendations so far, of which 13 are in the money.</p>

In our monthly trade ideas recap note, we provide a performance update of the trade recommendations in FX and rates that we make on a weekly basis and discuss those we closed last month. We have made a total of 18 trade recommendations so far, of which 13 are in the money.

Alpha Bites: Trade Ideas Performance Summary – July 2021

Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

<div>DXY – Call for a DXY ST top near 93/92.70 to lock in some gains and work into select USD shorts for a pullback to 91.50 with risk to 91, to add back to USD longs and resume the rise targeting 94.</div><div></div><div>Timing risk: Pullback sequence should take the form of an elevated choppy pullback.</div><div></div><div>Next phase of the USD rise needs the 10yr to bottom near 1.37% support and start a fresh up cycle in yields.</div>

DXY – Call for a DXY ST top near 93/92.70 to lock in some gains and work into select USD shorts for a pullback to 91.50 with risk to 91, to add back to USD longs and resume the rise targeting 94.Timing risk: Pullback sequence should take the form of an elevated choppy pullback.Next phase of the USD rise needs the 10yr to bottom near 1.37% support and start a fresh up cycle in yields.

<p>With the Fed turning hawkish, the pressure on EM central banks to do the same has increased. In this note, we identify the countries where 2s5s slopes can flatten as rate hikes get priced in earlier than before.</p><p>Separately, the attached file is a snapshot of the EM 10y rates market in which we seek to identify the leaders and laggards among countries by comparing the performance of each to its history as well as to other countries based on their respective betas to an EM rates index.</p>

With the Fed turning hawkish, the pressure on EM central banks to do the same has increased. In this note, we identify the countries where 2s5s slopes can flatten as rate hikes get priced in earlier than before.Separately, the attached file is a snapshot of the EM 10y rates market in which we seek to identify the leaders and laggards among countries by comparing the performance of each to its history as well as to other countries based on their respective betas to an EM rates index.

Rates 10y Dashboard: Which EM Countries to Target for 2s5s Flatteners?

South Korea

The South Korean won is the official currency of The Republic of Korea (South Korea). 

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KRW (USDKRW CURNCY)

FX Dashboard: Cross-Correlations Between EM Currencies Rise Sharply

While we are not expecting the FOMC meeting tomorrow to be market-moving, we need to watch for any impact on the dollar as it would ripple through...

Gautam Jain, PhD, CFA

Kospi Index Retesting the Pivot Area

The Kospi Index has pulled back to important levels again and is looking vulnerable. What happens here is likely to be important

Shyam Devani

Alpha Bites: Trade Ideas Performance Summary – July 2021

We provide a performance update of all our trade recommendations along with discussing those we closed last month. We have made a total of 18...

Gautam Jain, PhD, CFA

USD Long Trim with Fresh Buy Levels

DXY – Call for a DXY ST top near 93/92.70 to lock in some gains and work into select USD shorts for a pullback to 91.50 with risk to 91, to add...

Thomas Schroeder

Rates 10y Dashboard: Which EM Countries to Target for 2s5s Flatteners?

With the Fed turning hawkish, we identify the EM countries where 2s5s slopes can flatten as rate hikes get priced in earlier than before.

Gautam Jain, PhD, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)