Talking Points:
• NFPs beat expectations, the jobless rate hit a 7-year low and wage growth finally lurched higher
• Once strong skepticism in a Fed hike is receding and driving the Dollar higher in turn
• There is trade potential in growing mon pol disparity, but the big picture should follow 'risk' bearings
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A strong US labor report has cemented the Dollar's fundamental lead in a broadening monetary policy gap. The Greenback cleared the resistance that had capped its progress in 2015 and the currency now trades at 12-year highs. In the immediate future, the intensity of the Fed's rate conviction will determine the degree of follow through for the currency. However, this is not an unexplored fundamental theme. We have seen significant trends arise from the divergent efforts of major central banks. And, while we will continue to see it wrought influence over exchange rates, a deeper and unharnessed theme may soon take over: investor sentiment. We look at the opportunities that are arising from our changing fundamental backdrop in this weekend Trading Video.
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