Just in time for Thanksgiving, a passel of currency experts have offered up trades that should make you grateful.
The currency markets have been challenging, to say the least, but in honor of Thanksgiving, I asked several currency experts to suggest trades that should make you thankful. Here's what they said:
Camilla Sutton, chief currency strategist at Scotia Capital, likes the Canadian dollar against the euro. "The combination of Canada's triple-A status, commodity base, stable government" and relatively solid economic fundamentals should bolster the loonie, she told me, while the euro against the Canadian dollar "should face significant headwinds ahead." She expects a short euro-Canadian dollar position to work out nicely.
Marc Chandler, chief currency strategist at Brown Brothers Harriman, also likes the Canadian dollar against the euro. "News from Europe seems more likely to be negative than positive and CAD fundamentals look superior," he says. He suggest entering the trade around current levels with a stop near 1.4075, close to Wednesday's high, and a target of 1.38 or lower.
Rebecca Patterson, chief markets strategist for J.P. Morgan Asset Management, Institutional, bought the dollar against the Swedish krona recently, and also sold the Australian dollar against the dollar. "They have worked great," she told me, and while the Aussie trade is near her target, her first idea may still have room to run.
Chris Fernandes, vice president and forex adviser at Bank of the West, likes commodity currencies as a longer term play. "I like the Australian dollar and the Canadian dollar - the Australian dollar maybe a little more just because Australia is more closely tied to China and Canada is tied to the U.S.," he told me. "I think commodity prices are going to stay firm."
Paresh Upadhyaya, chief G10 FX strategist for Bank of America Merrill Lynch, also wants to sell the Australian dollar, but he would do so against the Canadian dollar. The Aussie "is more vulnerable to a global growth slowdown," and the Reserve Bank of Australia is starting to cut interest rates while the Bank of Canada is on hold, he told me. "I'm thankful for this trade."
Hopefully, you will be, too.
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