USD poised for recovery - BNP Paribas

According to BNP Paribas' FX strategy team the USD is poised for recovery and that risk reward for longs has improved considerably.

Key Quotes:

"After trading firmly on Tuesday, the USD has retreated slightly today with US front end yields trending lower. We maintain our view that the USD is poised for recovery and that risk reward for longs has improved considerably since the beginning of the year. Our BNP Paribas Positioning Analysis indicates that the market is currently short USD (-14 on a -/+50 scale), down from +22 in the beginning of this year. Therefore, there is a lot of room for new long positions to be added. We continue to favour long USD positions vs. commodity exporter currencies as these trades can do well in the event of a resumption of broad USD strength or a continued unwind in risk sentiment."