NEWS / European Community

Global-View.com Monthly Forex Survey Analysis Courtesy Cumino

EUR USD 3 months: 1st day close 1.2806(1.2921), av. responses 1.29(1.2919), Adjusted boundaries 1.24-1.32(1.25-1.33).

GVI 55%(53%) COMPONENTS 13%65%22%(14%65%21%). DRY INDEX: 73%(52%).
6mstdev: 8%(8%).

EUR INDEX roughly unchanged. DRY index is high.

From last Survey the background is changed. Risk tolerance diminished, VIX diminished, the 12m and 1m Weighted currency Vol Index are now low and back to year average (with 1m again lower than 12m). EMBI+ spread is higher as well as US high yielders. Swap spread over Treasuries is at record high; this could be interesting if you see those as one of the measures of general liquidity draining. USD synthetic RR1m weighted as well as USD margin positions are almost neutral from stretched at last Survey, while USD synthetic COT short positions halved. The swap 3m 1y forwards are mixed with USD and CAD gaining @30 bp, EUR @23bp, GBP @11 and JPY @9bp. Emerging markets from general selling became more selective, with increased inverse currency correlation between those countries with a bad and good C/A position.

USD JPY 3 months: 1st day close 114.80(112.08), av. responses 112.84(110.92), Adjusted boundaries 111-119(108-116).





GVI: 37%(40%) COMPONENTS: 33%61%6%(23%74%3%) DRY INDEX: 24%(32%).
6mstdev: 6%(5%)

Bearish USD in absolute and relative terms, bearish medium and short term. DRY INDEX low.
Neutrals diminished 13% and USD strong bears increased 10%.

Note that EUR JPY forward carry to risk measures as well as EUR JPY carry to risk measures are the highest of 2006 and especially the latter is at levels seen in 2002. In other words, just like I pointed out in the previous comment, I would be cautious about searching for a top in that cross.





OIL 3 months: 1st day close 73.93(72.60), av. responses 73.98(71.27), Adjusted boundaries 67-81(66-80).

GVI: 44%(43%) COMPONENTS: 14%84%2%(18%79%3%), DRY INDEX: 65%(38%)
6mstdev: 3%(3%).

Unchanged. People remain medium term bearish, mostly on relative prices considerations. DRY INDEX is high, so in the short term traders are slightly bullish.