22 May 2015
Trade of the week: Sell AUD/NZD, target 1.0340 - BNP Paribas
FXStreet (Bali) - BNP Paribas, on its trade of the week, recommends selling AUDNZD with a target of 1.0340, based in large part on the unjustifiably stretched short positioning in the NZD, and as RBA remains on easing mode.
Key Quotes
"The current risk environment is conducive to relative value trades, driven in large part by diverging monetary policy expectations."
"Our two top trade recommendations leverage the policy divergence theme alongside what our BNP Paribas positioning indicator has been flagging: namely, unjustifiably stretched short positioning in the NZD."
"This week we recommended selling AUDNZD with a target of 1.0340 and we also add a long GBPSEK recommendation with a target of 13.40."
"The NZD should benefit from repricing away from rate cuts. By contrast, Sweden’s Riksbank will have to engage in further easing, which will weigh on the SEK vis-à-vis currencies where monetary policy is likely to be normalised, such as the GBP."
Key Quotes
"The current risk environment is conducive to relative value trades, driven in large part by diverging monetary policy expectations."
"Our two top trade recommendations leverage the policy divergence theme alongside what our BNP Paribas positioning indicator has been flagging: namely, unjustifiably stretched short positioning in the NZD."
"This week we recommended selling AUDNZD with a target of 1.0340 and we also add a long GBPSEK recommendation with a target of 13.40."
"The NZD should benefit from repricing away from rate cuts. By contrast, Sweden’s Riksbank will have to engage in further easing, which will weigh on the SEK vis-à-vis currencies where monetary policy is likely to be normalised, such as the GBP."