Why the US Dollar didn't fail today

Discussion in 'Forex Trading' started by PohPoh, Jul 24, 2008.

  1. after the housing bill passed?

    Short term bottom in USD?
    Interest rates going to rise?
    Enron Loophole closing?

    Scraps for thought...
  2. Take my words with a grain of salt, but I think traders are betting that the Fed will be raising interest rates in their next meeting.
  3. Brandonf

    Brandonf ET Sponsor

    I think the same thing, if you look at prices on Utilities and Bonds they are saying the same thing as well.
  4. As I wrote few weeks ago, the dollar has bottomed. EUR will take a beating in the future. The dollar is up because the eur is doing down, not because of USD.

    In RFT's blog we have been trading EUR/JPY and EUR/USD on this assumption, and pips have been piling up. We the analysis and assumptions must be right.
  5. Not really...
    Fed Funds futures trading at 97.99...a 4% chance of a hike
  6. Let correct you. USD did not fail vs. eur, but it DID FAIL vs. the Yen. So your observation (in the title) is not correct.
  7. The next move will be a cut. I think the market is completely wrong pricing in a 45% chance of hike by Oct. The Fed's hands will be tied by the continued stress in financials.
  8. There are no good alternative currencies. The euro is massively overvalued, and the Europeans are lazy, the dollar is getting devalued, the Japanese have no growth, and their savings are locked up in rotting US debt. You can't trade the Chinese RMB.

    The world follows the US footsteps, it is going to be competitive devaluations in a global economy, the US debasing their currency will lead the Europeans, Japs, and Chinese to follow suit to keep up their exports.

    In the end, commodities continue going through the roof and inflation goes rampant. But who cares, as long as that Fannie Mae and Freddie Mac are saved and we can continue with the broken business model of selling homes to the poor with easy credit, that don't need to be paid back because government will bail you out.
  10. No way. They may not hike because of growth concerns, but I highly doubt a cut is in the cards with inflation as it is.
    #10     Jul 25, 2008