Wednesday March 7, 2007 - 14:10:54 GMT
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GVI Monthly Forex Poll Analyis Courtesy Cumino
EUR USD 3 months: 1st day close 1.3098(1.2928), av. responses 1.2998(1.2982), Adjusted boundaries 1.27-1.35(1.25-1.33).
GVI 39%(56%)COMPONENTS 24%73%3%(8%73%19%). DRY INDEX: 50%(54%).
EUR GVI INDEX Bearish. Neutrals unchanged. 16% of strong bulls passed to strong bears camp.
Last Survey I suggested that EUR could be increasingly perceived more for itself and less as pure anti-dollar.
USD JPY 3 months: 1st day close 115.83(120.33), av. responses 116.31(118.86), Adjusted boundaries 112-120(116-124).
GVI: 51%(49%) COMPONENTS: 18%63%19%(16%71%13%) DRY INDEX: 60%(30%).
Neutral in absolute terms, USD bullish in relative terms. Neutrals slightly diminished.
At least from the Survey point of view it seems to be a relative price mentality, which means that almost no one really thinks that the recent turmoil is more than a brief correction.
This surprised me. Even if the judgement is correct fears should be more perceived. Personally I think, whatever the immediate cause, that such broad based events will adversely influence the risk/reward fundamentals of the carry trade at least for another two weeks.
OIL 3 months: 1st day close 59.94(58.74), av. responses 61.83(61.44), Adjusted boundaries 53-67(52-66).
GVI:55%(59%) COMPONENTS: 1%88%11%(3%77%20%). DRY INDEX:74%(70%)
A bit diminished but still bullish. Neutrals are at the all time high. BTW Neutrals are high also for EUR and JPY, notwithstanding the recent turmoil. This is in line with fx vols where the jump was less severe than the other markets (fixed income and equity market were 3 Sigma events i.e. over the past ten years daily declines exceeded this only 0.3% of the time. VIX was a 6 Sigma event. Risk aversion measures are generally higher than the last 2006 spring turmoil.)
In few words the level of complacency in forex, normally the most sensitive, seems rather high, suggesting that possible breaks of supports/resistances have considerably less chances of being false breaks.
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