Market Crash Imminent? Dollar Is About To Surge Against Pound, Europ, Yen And It Is Going To Hurt Corporate Profits. Andy Xie: A Strengthening Dollar Could Trigger New Financial Crisis
February 24th, 2013
It Looks Like The Dollar Is About To Surge
Good perspective here from SocGen’s currency analyst Sebastien Galy. Between the Italian election uncertainty and the UK downgrade, it’s safe to expect another dollar pop:
The combination of a UK downgrade and a uncertain Italian elections are the fuel for a run of stop losses on long GBPUSD and EURUSD at the opening of the markets in Asia. CFTC positioning had already shown another large scale profit taking on USD shorts and we are likely in the process of neutralizing these positions in favour of JPY shorts (see report for those that asked to be on the cftc mailing list). It is the stuff of a strange golden age of fx, under invested, over achieving for no great reason, a telltale of a greater instability in the global economy.
A confluence of uncertainty helps the greenback.
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The two most-hated currencies in the world.
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