Macro Strategist, Saxo Capital Markets

Kay Van-Petersen

Macro Strategist

Saxo Capital Markets

Thematic (Sector/Industry)

Australia Financials / Thematic (Sector/Industry)

<ul><li>Last week’s structural degradation on the USDJPY cross is a messenger bearing grim tidings – a big sell off is imminent – as we sliced through the critical 110 level like fish through water</li><li>USDJPY at 108.07 on Friday is now down -9% &amp; -1% from QE III &amp; QE II rounds in Japan</li><li>Whilst timing is always the factor, I favour portfolios with downward exposure, be they long vol, long puts the Nikkei/Kospi/Dax/Dow/S&amp;P or outright shorts on those indices</li><li>On currencies, even though I feel we are in a USD liquidation phase, tactically I favour risk-off crosses such as Short AUDJPY, Short NZDJPY, short GBPJPY. With that said EURUSD should take out 1.15 this week from Friday sub 1.14 close </li><li>On commodities, once again Gold miners GDX &amp; spot – remember the call people, we will see $1500 sooner than you think. And on bonds, once again US10yrs, yes at 1.75% they are tight. But it’s a relative world with JGBs &amp; Bund at -7bp &amp; +9bp &amp; key event risks in Jun &amp; Jul globally, +1.75% is a steal…</li><li>Lots of data due out this week: US earnings season kicks off today, globally its an inflation themed week &amp; there will be a big focus on China’s GDP due out on Fri (15)</li></ul>

Last week’s structural degradation on the USDJPY cross is a messenger bearing grim tidings – a big sell off is imminent – as we sliced through the critical 110 level like fish through waterUSDJPY at 108.07 on Friday is now down -9% &amp; -1% from QE III &amp; QE II rounds in JapanWhilst timing is always the factor, I favour portfolios with downward exposure, be they long vol, long puts the Nikkei/Kospi/Dax/Dow/S&amp;P or outright shorts on those indicesOn currencies, even though I feel we are in a USD liquidation phase, tactically I favour risk-off crosses such as Short AUDJPY, Short NZDJPY, short GBPJPY. With that said EURUSD should take out 1.15 this week from Friday sub 1.14 close On commodities, once again Gold miners GDX &amp; spot – remember the call people, we will see $1500 sooner than you think. And on bonds, once again US10yrs, yes at 1.75% they are tight. But it’s a relative world with JGBs &amp; Bund at -7bp &amp; +9bp &amp; key event risks in Jun &amp; Jul globally, +1.75% is a steal…Lots of data due out this week: US earnings season kicks off today, globally its an inflation themed week &amp; there will be a big focus on China’s GDP due out on Fri (15)

Haitong Securities Co Ltd (A) (600837 CH)

Sumitomo Mitsui Financial Group (8316 JP)

Mitsubishi UFJ Financial (MUFG) (8306 JP)

Sumitomo Mitsui Financial Group (Sponsored Adr) (SMFG US)

Sumitomo Mitsui Financial Group (Sponsored Adr)

Shanghai Pudong Development Bank Co. (600000 CH)

Mitsubishi UFJ Financial (MUFG) ADR (MUFG US)

China Pacific Insurance (Group) Co., (601601 CH)

Global Macro Take: WK 15. False Gods Be Damned….