30 Oct 2013
Flash: A dollar for Fed day – Societe Generale
FXstreet.com (London) - Sebastien Galy said, “If I had a dollar on Fed day, I would rather not risk it”.
Key quotes:
“They know nothing more, have no incentive to act and clearly need to maintain the portfolio channel (wealth effect). Yet all think as I do and have little incentive for risk taking into year end, and so positioning lags price action even more than usual”.
“If the Fed does as expected or proves a bit dovish equity markets will react and some prudent folks will go for a round of profit taking. This is compounded by some more worrying techies according to some clients. Does it matter for the subsequent trend not too much”.
“If the Fed does not deliver its gentle message, misunderstanding the level of risky assets with actual confidence, it will not be a happy time for USDJPY and EURJPY. We proposed a very cheap downside one touch in eurjpy as a hedge against the nikkei. It is cheap for a good reason”.
Key quotes:
“They know nothing more, have no incentive to act and clearly need to maintain the portfolio channel (wealth effect). Yet all think as I do and have little incentive for risk taking into year end, and so positioning lags price action even more than usual”.
“If the Fed does as expected or proves a bit dovish equity markets will react and some prudent folks will go for a round of profit taking. This is compounded by some more worrying techies according to some clients. Does it matter for the subsequent trend not too much”.
“If the Fed does not deliver its gentle message, misunderstanding the level of risky assets with actual confidence, it will not be a happy time for USDJPY and EURJPY. We proposed a very cheap downside one touch in eurjpy as a hedge against the nikkei. It is cheap for a good reason”.