This week the scorecard recommends buying the CAD, AUD and USD while selling the GBP, NOK and JPY.
All input factors currently favour a long CAD position and thus the scorecard recommends buying CAD this week. Most input factors also support the case for a long AUD position, and again this week, the scorecard also recommends buying AUD. Finally, the long basket this week includes USD as last week's USD sell-off seems overdone according to the model. Most input factors besides FX score are however signalling further downside for the US dollar.
The GBP was last week's top-performing currency among G10. According to the model, last week's rally was overdone and thus the scorecard recommends selling GBP this week. Besides the FX score, the risk premium input factor also favours a short GBP position. NOK also gained markedly last week following the release of higher-than-expected CPI data. While the rally seems overdone according to the model and the scorecard recommends selling NOK this week, the input factor for interest rates currently favours a long NOK position.
Last week's signals resulted in a 0.7% loss. In particular, the short NOK and GBP positions were expensive, while the long AUD position performed well.
Next scorecard signals will be sent out on 24 February.
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