Bob's Currency Focus - 16:00 GMT

EUR/USD
Traders took advantage of thin trading conditions early Friday morning to push the euro to 1.4966, just short of the psychologically important 1.50 price level. It is a case of history repeating itself as it was on this same week one year ago that the euro made a surprise attack to take out the 1.30 price level, while US traders were sitting down to their Thanksgiving dinner. I called it yesterday, warning there may be a sharp correction downwards upon a successful/failed attempt to breach 1.50, and the euro has now fallen back to trade just around the 1.48 price handle. Data from the euro area this morning was poor, pointing to a further slowdown in the euro economy and highlighting the that economic softness is not restricted solely to the US. French consumer spending fell sharply in October, while industrial activity across the wider euro area slowed in November, based on preliminary PMI readings released Friday. There were also strong comments from ECB President Jean Claude Trichet this morning, again emphasising brutal moves in currency markets were unwelcome. Many may interpret this to mean the ECB might intervene, if the euro continues to appreciate at the current pace. 1.50 being a step too far today's market, soft euro-zone data and fear of Central Bank intervention combine to trigger a bout of profit-taking and we will need to wait until Monday when markets return to normal, to establish whether immediate direction is in fact up or down. If the dollar can close Friday below 1.4780, there is a chance we could see a broader retreat earlier next week, certainly back to 1.4660. At current prices and in such a thin market it is not worth getting involved. The time to have been in the market was this morning, to sell down the euro when it reached its inflated peak. It must be noted the euro has closed strongly most Fridays of late, and if the single currency does hold support at 1.4780, it could rally nearer to 1.4850 before the close today. Strategy: Stay out until markets normalise on Monday.

GBP
Sterling jumped on the dollar-thrashing wagon early Friday, when only a fraction of the normal market was up and running, and cable reached an improbable price of 2.0766. The move was proven to be premature however and the pair crashed back to below 2.06 soon after the European market was up and running. UK Quarter 3 GDP was revised downwards to 0.7%, from the preliminary 0.8% reported last month, but what was more significant to markets today was the mortgage lending figures released by the British Bankers Association this morning. The report from the BBA showed the number of mortgage approvals fell to 44.1K in October, from 52.6K in September. The slowdown in the housing sector and ongoing credit stresses in financial markets mean the Bank of England will possibly move to cut interest rates when they meet in a fortnight’s time, rather than wait until the new year. Expect sterling to come under increasing pressure next week, once markets return to full capacity and traders have had time to digest the significance of this week’s events. Even factoring in the negatives, sterling may be able to pull the euro back to 0.7150 early next week, as the euro remains grossly overbought against the UK currency. Cable continues to offer a good sell down opportunity and I would again sell the pair on any price close to 2.07, with price targets of 2.06 and 2.0550. I would not be surprised to see cable drop to 2.0250 next week, given the increasing probability of a December rate cut and the fact a December rate cut by the Fed (by no means guaranteed to happen) is effectively fully priced into the dollar. Strategy: Sell cable on prices close to 2.07 for limit of 2.06 and 2.0550. Sell down sterling against the Aussie dollar while stock markets are rallying.

Yen
The Japanese currency surprised this morning, making significant inroads across the board, despite a recovery in global stocks Thursday and Friday and with markets being closed in Japan Friday for a holiday. This is the first day in quite some time when the yen has rallied while stock markets were on the up. It may be an indication of just how deep the current strain of market fear runs, as the Aussie and Kiwi dollars have remained primarily on the defensive, with the carry trade also away for the Thanksgiving break. A new 2.5 year low was printed this morning for USD/JPY at 107.56, and the pivotal 2005 low of 106.47 is now within reach and could be hit next week, if risk aversion levels remain high. The yen made an even more significant move against the euro today, the single currency dropping below Y160. There is the possibility of a correction back towards Y158 early next week, if the broader flight to safety across markets continues. We must however recognise the number of yen shorts in the marketplace has been falling significantly of late and the pace of the Japanese currency’s should now begin to slow. The yen will also be forced to retreat next week if expectations for a Fed rate cut in December grow and it restores stability to US financial markets. Strategy: Stay away from yen until markets normalise (Monday).

CAD
The loonie has been stuck in a 0.98 to 0.99 range for yet another day on Friday, although the advantage looks to be with the dollar as the USD/CAD pair is continuously being bought on dips. Parity is near upon us again and I expect it to be hit within the next week, although elevated oil and gold prices will arm the loonie with some short-term resistance. It seems unlikely the Bank of Canada will wait until the first quarter of 2008 before cutting interest rates, particularly given the benign inflation data released this week. The sharp fall in base metal prices will raise doubts about global economic growth and this too will tend to undermine the loonie. The loonie looks to me to be the most vulnerable of all the major currencies right now, given its proximity to and dependence upon a US economy entering a downturn. The euro remains overbought against the Canadian currency, but now is not the time to be buying the loonie against any currency in my view, given the underlying risks. USD/CAD potentially offers the best opportunity of all the major currency pairs at the moment. Strategy - Short-term is to buy USD/CAD on dips to below or around 0.98 with targets of 0.9880 and 0.9920. Positional: buy USD/CAD at best available price (preferably below or at least close to 0.98) with stop at 0.95 and price target of 1.05 (moving stop to above 1.0 when parity convincingly broken).

Bob B - Nov 23

Bob's Currency Focus - 17:00 GMT

EUR/USD
Little activity on the currency market today with US markets closed and markets elsewhere taking a breather. Volatility has been surprisingly low, considering the negative sentiment that carried over from Wall Street Wednesday and the extreme overbought levels of this pair. Equity markets have settled across Europe Thursday, although risk aversion levels have not disappeared, as evidenced by the reluctance of traders to re-enter the carry trade. Industrial orders in the euro area fell by a significant 1.6% in September with the annual rate slowing to 2.0% from 5.2% in August. Economists had forecast a 0.5% drop on the month and an annualised growth rate of 6.7%. The adjusted current account for the euro area also narrowed much more than expected in September, to €0.6B from €4.5B a month earlier. Currency markets remain immune to less than positive news from the euro area and today’s disappointing data had no market impact on the teflon euro. The single currency had rallied to a new lifetime high of 1.4872 overnight and with the pair currently in and around 1.4850 and not having dipped below 1.4820 all day, it will be a surprise if there is not a run on the 1.49 line (at least - remember what happened on this week last year?) before tomorrow. The main reason why the euro won’t reach 1.50 this week might be upside exhaustion, with far too many euro long positions in the market. Friday’s flash PMI data for the euro-zone could potentially put a fly in the ointment however, particularly if any of the indices report a contraction. The indices are due out at 09:00 GMT - see link to calendar at end of page. There is little value in buying the euro at current prices and I prefer to wait for a correction, before entering at a more attractive bid price, but I might sell once the euro has made a run (failed or otherwise) on the 1.50 price mark. Strategy: Sit and wait. But sell if there is a contracting PMI reported for the euro area Friday.

GBP
Cable has held up remarkably when one considers the chances of a December rate cut are increasing all the time. Sterling is being protected by dollar weakness and the general market preference currently being given to the major European currencies. Cable may rise higher if the euro makes a run on the 1.50 price level, but any significant rallies are likely to attract selling interest and in this regard sterling is very vulnerable. Total Business Investment in quarter 3 disappointed, coming in flat against the previous quarter and if Friday’s BBA mortgage lending figures report soft, sterling may come under more immediate pressure. The euro is clearly overbought against sterling, but it may not retreat until there is a broader euro sell-off which should come when the current rally against the US dollar stalls. Strategy: Sell any cable rallies close to 2.07, with targets of 2.06 and 2.0550. Sell down sterling against the Aussie dollar while risk aversion levels are falling.

JPY
The yen has held its own Thursday even though the Japanese Nikkei and European Stock markets rallied, so the move towards 106.50 will have to wait. The yen not being sold off thus far today has more to do with the lack of liquidity than anything else, so if Asian stocks rally tonight, the yen should retreat. There may be some reluctance on the part of carry traders to enter the fray after the thrashing they have taken in recent days and with trading conditions running thin we could witness lots of volatility across the yen carry trade pairs until Friday’s close. The dollar should be able to push the yen back above the Y109 mark tonight with the chance of a return to Y110 tomorrow, if risk aversions levels fall. The euro has been trading around the Y161 mark for most of the day, but it could return to Y162.50 over the next 24 hours. The Japanese currency is unlikely to be able to make much headway while US markets are closed, but traders thinking of selling the currency need to keep a close eye on stock markets and need to allow for increased volatility because of the thin trading conditions. Strategy: Stay away from yen until market conditions normalise (wait until next Monday).

CAD
The loonie has traded in a 0.9789 to 0.9880 range with the US dollar all day, which is a good performance considering the loonie is coming off the back of some very negative reports for the currency in the past 2 days. It now seems certain the Bank of Canada will be cutting rates soon, to try to avoid any serious deterioration in the economy and the first cut could come in December. This is very negative for the loonie and while the euro has made very significant gains in recent days, the loonie still looks well priced against the US dollar, when one looks at the level of bad news already priced into the US currency. There is no data between now and the end of the week and while elevated oil and gold prices are temporary offering some currency support, the broader weakness seen in base metal prices will tend to undermine the outlook for the Canadian economy and it is difficult to see how the loonie cannot weaken further from here. Strategy: Buy USD/CAD on dips below 0.98, with targets of 0.9880 and 0.9920. A longer run position is to buy USD/CAD and hold the position with a longer run target of 1.05+, against a stop at 0.95. I'm now a loonie bear :-) and bullish USD/CAD.

Bob B

Bob's Currency Focus - 17:00 GMT

EUR/USD
The dizzy heights the euro is scaling right now are scary. 1.7 cents against the dollar in a single day - Tuesday, when the currency was already trading close to its lifetime peak, is extreme to say the least. Markets are trading on the assumption the Fed is going to cut rates by its December meeting, regardless of what else happens, and they may indeed be right. The minutes of the October meeting, released Tuesday, pointed to it being a ‘close call’ on whether rates to cut or not at that time. Most Fed members that have spoken in the past week attempted to play down expectations for a further cut in December, but with economic data weakening further and Wall Street in sharp decline, the Fed may be pressurised into giving markets what they want. The Fed’s task would be made easier were other Central Banks to shift their policy positions before the Fed is forced to act again, otherwise the dollar is going take it on the chin again, oil prices will continue to hover around $100 a barrel and imported inflation into the US will grow. So far the ECB has shown little in the way of sympathy for the Fed or the dollar, with ECB members preoccupied with inflation talk in the euro area and are standing over their hawkish views. The euro is going to hit 1.50, possibly this week and it is difficult to see its ascent being halted in the current climate, unless there is a major shift in policy by the ECB, or intervention of some kind. It is highly significant that the euro is appreciating against the dollar at a time when global risk aversion levels are at a peak and while large funds are being transferred from equities into US bonds. Outside of the US it is clear that the euro, even at its current inflated price, is seen as a safer haven than the dollar. With US markets closed tomorrow and only operating at low capacity Friday, the dollar could come under further sustained attack, unless there is a major sell-off of the euro this evening or tomorrow morning. I expect to see the market try to reach 1.50 this week, whether it is warranted or not and even though it would translate into an ultra-extreme gain for a single week. Nobody seems prepared to stop it. Volatility levels are such and fear is so strong that further sharp moves are more probable than possible this week. It is difficult for traders to justify buying the euro at current prices, certainly not on a positional basis, because there is the danger of a sharp downturn at any time. I would be inclined to wait and see if the euro can take the pair higher (to 1.50) before entering the market at all and then sell down for a correction. Strategy: Stay out until successful or failed attempt to take out 1.50 and then sell down for a correction).

GBP
The Bank of England voted by a majority of 7-2 to maintain interest rates at 5.75% in November. The split decision increases expectations for a near-term rate cut from the bank’s Monetary Policy Committee and it could come as soon as December, particularly if the current credit stresses in financial markets persists. Cable had risen to a high of 2.0682 overnight, but fell to a low of 2.052 soon after the Bank of England’s minutes were released Wednesday. Negative sentiment against the dollar continues to protect sterling although the UK currency did fall to a new 4.5 year low against the euro, which is now trading just above 0.72 pence. Sterling did retreat sharply against the yen as the carry trade unwind continued, but the pound has risen significantly against all the commodity currencies today. With rate expectations now working against sterling, the currency remains vulnerable to a sharp sell-off, but it may take a broader US dollar recovery to trigger any major decline in cable, while EUR/GBP is overbought. Sterling will strengthen against the yen and the Swiss franc and weaken against the Aussie and New Zealand dollars if stock markets recover. It is dangerous to buy the pound right now and any further cable moves towards 2.07 offers a sell opportunity. Strategy: Sell cable on prices close to 2.07, with target of 2.0550.

JPY
The yen hit a 2.5 year high against the US dollar Wednesday and has traded strongly for all of the European and US trading sessions – the USD/JPY pair hit a new low of 1.0825 this morning. If risk aversion persists to the end of the week, the yen could push the dollar back towards the May 2005 low at 106.47, with the aid of further carry trade unwinding. US markets are closed Thursday and if global stock markets stabilise, the yen will be forced to retreat back above Y110 against the dollar. Japan’s October’s trade balance was in line with expectations, 66% up on the same month one year ago, but market direction for the yen is currently dictated by risk aversion and fear, not data. The yen gained 1% against the euro today and at Y161.16 this remains the pair that offers the best yen value under current market conditions, but only to sell it at prices above Y163. If stock markets stabilise late Wednesday and into Thursday, the yen will be sold off, as elements of the carry trades return and the yen should be avoided, other than to sell it.

CAD
September’s retails sales numbers surprised to the downside, falling by 0.2% from August. Retail Sales for the quarter (Qtr 3) declined for the first time since 2003 and this coupled with Tuesday’s soft inflation numbers open the door for a possible bank of Canada rate cut as soon as December. The shine continues to come off the loonie and on Wednesday the US dollar hit a 7 week high against the Canadian currency, reaching 0.9923. The trend has definitely turned and USD/CAD should now be bought on dips and we may reach parity this week. If the pair returns to parity while risk tolerance levels remain low, then the US dollar could move significantly through the other side. The Canadian dollar is oversold against the euro, but there is little value in trying to buy the loonie right now, given the shift in the currency’s outlook. Strategy: Buy USD/CAD on dips below 0.98 with a price target of 0.9850. Also, place advance orders to buy USD/CAD at 1.0000 and hold on positional basis.

Bob B - Nov 21

Bob's Currency Focus - 13:00 GMT

EUR/USD
Many traders were caught off-guard by the swiftness and brutality of this morning’s dollar slide. It also caught me by surprise, although I had noticed how the euro had refused to lie down over the past week and was essentially lurking, ready to take the EUR/USD pair to a new peak, should the opportunity arise. I had warned previously that this is a dangerous week for trading and we may see a number of sharp, erratic moves as trading volume thins, owing to the big holiday in the US later in the week. The euro rose 1.3 cents this morning to hit a new all-time high of 1.4796. The markets now sense 1.50 is inevitable, regardless of the fundamentals and traders could use the thin trading conditions this week to push the advantage home. There is growing complacency though and traders refuse to recognize the significance of falling stock markets outside of the US and the softer data ebbing out of the euro area. This is not solely a US problem and the idea we are going to witness a booming euro economy into 2008 against a recession-hit US is far-fetched to the extreme. The euro is effectively the most over-valued currency right now and it is trading beyond its worth, but markets still refuse to sell it off or allow it to correct. The currency has now risen 14 cents against the dollar since the middle of August without a meaningful correction and that is unprecedented for this pair. The dollar has again been undermined by underperforming US stock markets, which has brought the usual suspects demanding a further Fed rate cut. There was even a rumour across Asian markets during the night the Fed were about to announce an emergency rate cut today. The view that Ben Bernanke will single handedly save the economic world by continuously cutting US interest rates is madness, but this seems to be the view which prevails right now and which is dictating market direction. I am worried the euro has gone too far, at least in the short-term, but trading is going to be so unpredictable this week, I also cannot say it will not go higher. The Fed’s minutes this evening will be critical, to possibly lower expectations for a December rate cut, while a more upbeat assessment/forecast for the US economy in 2008 should help give both stock markets and the dollar a bounce at the same time. I won’t be surprised to see the euro back below 1.47 by the end of the day, but it could also go the other way. Look out for the housing data at 13:30 GMT, a major surprise either direction in the report could trigger further moves.

GBP
Sterling rebounded spectacularly Tuesday, thanks to heightened negativity towards the US dollar. The pound jumped to 2.0650 against the dollar a short while ago, up over 1.6 cents on the day. How much this move has to do with thin trading conditions we don’t know, but the fundamentals for the pound have not changed. The outlook into next year is for rate cuts from the Bank of England. There is growing speculation of a further easing move by the Fed in December, which has triggered today’s move against the dollar. Sterling has tagged onto the coattails of the euro this morning and has benefited from the move away from the dollar into European currencies. It is hard to see how markets can justify pushing cable much higher from here, but this is a week when markets won’t behave how we expect, with volume lower because of the extended US Thanksgiving holiday (many traders have closed their positions for the week). A break above 2.0775 could potentially lead to rally back up to 2.08 tomorrow. There is the danger of a very sharp retreat once again though, particularly if there is any significant sell-off of the euro against the dollar. It is dangerous to buy cable at current levels, because of the prospect of a sharp decline. I prefer to sell down, but will wait for a temporary peak to form. We may see a correction later today, after the Fed minutes are released. Today’s CBI Industrial Trends Survey for November surprised to the upside but this is not generally a market mover. Of more significance was the Bank of England’s money supply data released earlier Tuesday, which revealed a narrowing in the annual rate from 12.8% to 11.8%. This erodes an obstacle the Bank may have towards cutting interest rates in the near future. Cable should be capped around 2.07 today, while the pound will continue to struggle against the euro. Don’t be surprised to see a sharp cable retreat this evening.

JPY
The yen and the reasons for its recent rally were largely ignored Tuesday as the market focused on selling off the US dollar and buying into European currencies. The Japanese currency has lost out all around, but it has particularly lost out to the euro, the pound and the Swiss franc. Stock markets are rallying today, so with risk tolerance levels higher, the yen is again being used as the preferred funding currency. Much could happen yet later today, particularly if US stock markets reverse course later in the session. The key risk event for the yen is the Fed minutes (released at 19:00 GMT), which, if they disappoint stock markets, could lead to a weaker close on Wall Street and see the yen strengthen into the overnight session. The euro is back up to Y163 and this pair may offer the best value in any sell down, but only if risk aversion levels rise. If risk tolerance remains on the up, the yen could be pushed back to over Y111 by the dollar by late this evening, if Wall Street does manage to rally through to the close.

CAD
The biggest nail yet in the loonie’s recent demise came Tuesday when October’s consumer price inflation data was much softer than expected. In fact both headline and core inflation fell by 0.3% and 0.2% respectively in the month, against expectations for a rise of 0.2% for the headline rate and 0.1% for the core rate. The annual core rate of 1.8% is at the lowest for 16 months and this gives the Bank of Canada ample scope to cut interest rates in December, if they prefer to move sooner rather than later. Inflation in Canada is now much more benign than that in the US and with the Fed in an easing cycle, the Bank of Canada is now armed to follow suit. Broader US dollar weakness has largely masked the impact on the loonie Vs the dollar since the dat came out 3 hours ago, but the Canadian currency has fallen by 0.75% against the euro today. USD/CAD now looks destined for parity, possibly even this week and a soft retail sales report Wednesday will only accelerate this move. USD/CAD should be bought on any dips near to 0.97. The loonie should be able to correct somewhat against the euro and the Japanese yen as these cross pairs are excessively overbought, but the best strategy is to wait for opportunities to sell the loonie against the US dollar and not to buy it all. We shall take another look tomorrow after September’s retail sales data is published.

To be continued...

Bob's Currency Focus - 13:00 GMT

EUR/USD
This week may be quite volatile with exaggerated moves coming in either direction, owing to thin trading conditions because of the forthcoming US Thanksgiving holiday on Thursday/Friday. If US housing data on Tuesday is much worse than expected, then a rise in negative sentiment towards the dollar could see it come under serious threat Thursday and Friday, when the US market players are sitting down to their annual turkey feast. On the same week last year the dollar came under a sharp and sustained attack when US markets were closed and the greenback subsequently found itself on a major defensive right up until the Christmas break. We could possibly see a move in the opposite direction this week as most open positions are dollar short and it won’t take much of an erosion of these positions in thin trading to send EUR/USD sharply downwards. It is a week for caution and the technicals will have a very big part to play in determining direction. Later today we will see the release of the National Association of Home Builders report for November and anything short of a poor index reading will be a surprise. Expect to see EUR/USD range trade between 1.46 and 1.47 and traders could again use any bounce in US stock markets as an excuse to drive the euro higher. Weekend comments, or the lack of them, on current dollar weakness, from the G20 group of nations has offered the US currency no respite. Meanwhile comments from OPEC that the oil exporting body is to investigate the possibility of using a currency denominator alternative to the dollar for pricing the world’s most important commodity, has undermined the dollar. Continue to buy on dips and while there is the possibility of the pair rising above 1.47 Monday, we should see quite an element of fluctuation as trading becomes choppy, so don’t stay in too long.

GBP
Sterling showed some resilience late Friday when bouncing back against the dollar and closing strongly against the euro going into the weekend. The underlying fundamentals still suggest the UK currency will come under pressure and any upside rallies are likely to attract selling pressure, particularly against the dollar, where the pound still looks elevated in price. Only negative sentiment against the dollar will prevent cable drifting lower this week and having gone as low as 2.0354 Friday it will be a surprise if the next key level of support at 2.0246 is not severely tested this week. The UK currency is oversold against the euro and it should manage to limit its losses against the single currency in the short-term and this pair looks more likely to trade between 0.7120 and 0.7180. U.K. house prices grew at their weakest annual rate for 17 months in November and are unlikely to increase at all next year, U.K. online estate agent Rightmove said Monday. Rightmove's November survey showed house prices were 0.7% lower on the month and 7.9% higher on the year, the weakest annual rise since a 6.4% increase was recorded in June 2006. This comes on the back of a series of soft indicators in the past week and October’s lending data will be studied closely when it is released early Tuesday. The possibility of the Bank of England moving earlier than expected in cutting rates cannot be ruled out and further soft data will fuel speculation about a possible hike in December. Wednesday’s minutes of the November MPC meeting will give a clearer picture as to how the balance of opinion currently sits within the Bank of England. Cable will be boosted by any bounce in stock markets Monday but there is the risk of a sharp decline back below 2.04, if risk appetite levels diminish further. It is dangerous to buy sterling at present prices, given the very real risk of a sharp move downwards, so the preferred strategy is to sell against the dollar on prices above 2.0550.

JPY
The yen is back in vogue Monday with stock markets tumbling around the world and risk tolerance on the decline. The Japanese currency has pushed the dollar back 1 yen thus far today and the pair currently trade at 110.15. It looks inevitable we will see another assault below the 110 line and if the dollar fails to hold the year’s low for the pair at 109.12, then any follow-through below this level could trigger a new wave of panic selling on the carry trade and see high yielding currencies like the Aussie and New Zealand dollar, as well as cable, retreat very sharply across the board. Trading volumes are likely to remain thin over the entire week and price moves could be very much exaggerated, so traders need to be on their guard. The yen still looks to offer the best value against the euro, but only on prices above 163. We could yet see a move below Y160 this week, particularly if the yen breaks below the key 109.12 price against the dollar. National department store sales fell for the second consecutive month in Japan in October. There is nothing in the Japanese calendar this week that is going to have much influence. Markets will continue to be driven by sentiment and yen traders need to take their cue from stock market performance. If the Dow plummets lower Monday, then look for the yen to probe to at least 109.50 against the dollar, with the potential for a further downside move overnight. A recovery on Wall Street later today will send the yen backwards temporarily, with the US dollar likely to push the pair back towards 111.20.

CAD
The loonie came under pressure Monday, the currency being sold off heavily as yet another bout of risk aversion gripped financial markets. Economic data released Monday was mixed with Wholesale Sales posting a 1.1% rise in September while foreigners sold a net CAD5.21 Billion in Canadian securities in the same month. The latter figure is important as it signals foreigners did not see Canadian denominated assets as good value on the month the loonie reached parity with the US dollar for the first time since 1976. It also follows a similar $3.82 Billion sell-off in August. The loonie is down 0.7% against the greenback and 0.6% against the euro Monday (16:30GMT). Oil prices have come off their highs earlier and are now moderately down for the day and with metals prices also in decline, the commodity currencies in general are exposed. The greenback could rise to the highs we saw last week around 0.9886 later Monday, but any recovery in stocks later this evening could trigger a sharp correction back to at least 0.9740. There are two key releases out for the loonie over the next 2 days – CPI on Tuesday and Retail Sales Wednesday and positioning prior to the actual releases will be as important as any price movement after the releases, with evidence growing in the past week that sentiment is beginning to move against the Canadian currency. The preferred position is to buy the greenback on any dips close to 0.97. The Canadian Dollar should be able to correct back to 1.42 against the euro, once markets stabilise.