Investors might wait for January before realizing profits - Wayne McDonell

Participating at FXStreet's Live Channel: Forecast 2017 Festival, Wayne McDonell, Chief FX Market Strategist Trader'sway, live from Atlanta suggests that while the Fed continues with its policy of raising rates the USD will continue to appreciate. The problem, notes Wayne, is when are they going to fit a third rate rise time next year. Capitalizing on price action, Wayne is waiting for key technical triggers.

Key Quotes

"This is when technical analysis becomes very important. Macro trades are not going to change much (jobs, growth, etc.) but technicals will tell us about capital flows and investors preferences. From an American point of view, investors might wait for January before realizing profits earned in the equity markets, unless the indices turns before. Stops are there and they will be activated."

"Regarding the Japanese yen, the Japanese repatriation is to be expected for April corresponding to their fiscal year and there is when we could capitalize on retracement in the USD/JPY. [...] March I would be buying again [...] I would readopt a short bias eventually after summer 2017 [...] We are not talking so much about supply and demand but rather human emotion, and since fundamentals haven't changed the psychological targets most people are targeting now are absolutely achievable in the short-term. For this reason I'll not short USD/JPY starting in January, in any case I would chose another yen cross."

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