BNP Paribas low volatility G10 Momentum signals

23 December,, London – After analysing the market before the year end, BNP Paribas has shared the latest low volatility G10 Momentum signals based on the strength of a currency’s trend taking into an account FX price action, equities and rates.

Low volatility G10 Momentum signals

BNP Paribas low volatility G10 Momentum signals Source: BNP Paribas – Low volatility G10 Momentum signals

Analysis and commentary

The USD’s bullish momentum continues to stand out above the rest of G10 members, estimated close to its highs of the year with a score of 75 on a scale from -100 to 100.

The second and the third most bullish pairs are the JPY and NZD accordingly. The Japanese Yen momentum has not changed by much, remaining at a score of 29 out of 100. The New Zealand Dollar, on the other hand, has outperformed before the end of the year, scoring 26, the highs in a long time, as risks from Fed interest rate hike ease and dairy market stabilises.

“The NZD is an outlier in the commodity bloc – its momentum has turned positive due to a stronger currency and equity markets,” BNP Paribas added.

Meanwhile, the GBP, CHF, EUR, and SEK remain fluctuating around a neutral 0 point.

On the other side of the spectrum, “the strongest momentum signals continue to be long USD vs most of the commodity currencies – NOK, CAD and AUD,” BNP Paribas noted.

The biggest losers among the G10 bloc are the crude oil depended CAD and NOK. With oil scraping the new year to date low at 35 Dollars per barrel, no wonder the two commodity currencies struggle. However, as bottom in crude oil has formed, we could expect some retracement. Nevertheless, investment banks expect crude oil even lower at $20.

Consider reading: Credit Suisse EURUSD and AUDUSD technical analysis

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