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All Eyes on EUR/USD | John Kicklighter and Pete Mulmat on Market Themes

All Eyes on EUR/USD | John Kicklighter and Pete Mulmat on Market Themes

Research, Research Team

Every month, John Kicklighter, DailyFX’s Chief Strategist at DailyFX, and Pete Mulmat, CEO of IG US sit down to talk about some of their favorite FX pairs. The two touched on the Ukraine crisis, haven assets, and the macro-outlook for trade.

USD/JPY

John began the show by touching on the concept of safe havens. In FX, havens are USD, JPY, CHF, as they are extremely liquid and have high credit ratings.

Both USD and JPY’s status as havens makes trading and monitoring USD/JPY critical to understanding the market’s risk aversion.

All Eyes on EUR/USD | John Kicklighter and Pete Mulmat on Market Themes

Typically, going short USD/JPY is a best-practice for trading in times of stress, but as Chris Vecchio pointed out, it’s important to consider the import considerations of Japan. As an island nation, Japan imports 90% of its oil, causing USDJPY to see a mixed range through the crisis.

AUD/NZD

All Eyes on EUR/USD | John Kicklighter and Pete Mulmat on Market Themes

John moved on to talk about AUD/NZD. Some critical themes are Australian exports in base metals and Chinese energy, and New Zealand’s exports of wool, cattle, and dairy. This trade is built to allow traders to bet on the value of soft vs hard exports.

Pete also mentions that there are also AUD/NZD futures, if you’re interested in trading a liquidity rich AUD/NZD product outside of spot FX, but expect to pay margins and monitor your leverage closely.

EUR/CHF

All Eyes on EUR/USD | John Kicklighter and Pete Mulmat on Market Themes

Pete found that EUR/CHF reflected how markets are increasingly amoral. A short-term bounce and reduction in volatility reflect that the market may be becoming numb to the Ukraine crisis.

GBP/USD

All Eyes on EUR/USD | John Kicklighter and Pete Mulmat on Market Themes

GBP/USD technical are beginning to challenge levels, John likes 1.32 as a potential point of resistance. While technical look solid, be sure to monitor The Bank of England’s press conference this week.

EUR/USD

All Eyes on EUR/USD | John Kicklighter and Pete Mulmat on Market Themes

John has been closely watching EUR/USD’s volatility through the Ukraine Crisis. Inflation data in the U.S. and ECB rate decisions are released tomorrow. Expect tomorrow morning’s focus to be EUR/USD.

Click here to register for John and Pete’s next webinar.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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