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11 Mar 2015
EUR/USD and EUR/GBP extremely stretched, USD/JPY better - DB
FXStreet (Barcelona) - Technicals suggest EUR/USD and EUR/GBP are highly stretched and least volatile, notes Oliver Harvey, Macro Strategist at Deutsche Bank, and further suggests that USD/JPY might be a better trade choice.
Key Quotes
“EUR/USD is the top scoring currency pair. The currency pair is highly trending (to the downside) and breaking new ground, with VHF and new-groundiness at 99th percentile and 100th percentile respectively.”
“It is also one of the least volatile currencies according to implied volatility. However, it is highly stretched as measured by RSI metrics.”
“On absolute terms, it is already in its 98th percentile of RSI stretchiness.”
“EUR/GBP is also trending (to the downside) and breaking new ground. The currency pair is also the least volatile. However, it is the most stretched currency pair from RSI perspective suggesting not to chase the EUR/GBP rally.”
“USD/JPY may be a better choice, with high trendiness on an absolute basis (VHF above 90th percentile) but much less stretched price action.”
Key Quotes
“EUR/USD is the top scoring currency pair. The currency pair is highly trending (to the downside) and breaking new ground, with VHF and new-groundiness at 99th percentile and 100th percentile respectively.”
“It is also one of the least volatile currencies according to implied volatility. However, it is highly stretched as measured by RSI metrics.”
“On absolute terms, it is already in its 98th percentile of RSI stretchiness.”
“EUR/GBP is also trending (to the downside) and breaking new ground. The currency pair is also the least volatile. However, it is the most stretched currency pair from RSI perspective suggesting not to chase the EUR/GBP rally.”
“USD/JPY may be a better choice, with high trendiness on an absolute basis (VHF above 90th percentile) but much less stretched price action.”