FX Strategist

Greg Gibbs

Fundamental analysis of topical themes in FX

Amplifying Global FX Capital

Amplifying Global FX Capital was founded in 2015 and is fully owned by Greg Gibbs. It is a registered company both in Australia and Colorado, USA and is a licensed in Australia to provide financial services.

We are producing a regular trading view orientated macroeconomic analysis of topical themes in global financial markets, with a particular focus on foreign exchange. We invite you to view an “executive summary” of these reports in “AmpGFX Reports” under our “Research” menu.

These reports are drawn from the analysis of Greg Gibbs and inform the capital management he undertakes on behalf of the company. The trading performance is posted periodically on our website. We aim to build our company into both a research and capital management business. We are currently in the planning phase for managing capital for wholesale customers.

Greg Gibbs has spent his working life of more than 26 years in financial markets, beginning in 1989 at the Reserve Bank of Australia, after completing a Bachelor of Economics Degree (Honours) at the Australian National University. He has been a CFA Charterholder since 2005. He has worked in Sydney, Singapore, New York and London for major global banks and presented on foreign exchange markets to major financial institutions and companies around the world, and maintained a high profile in the financial media.

Before Amplifying Global FX Capital, Greg was the Head of Asia Pacific Market Strategy at the Royal Bank of Scotland based Singapore. He now resides in Breckenridge Colorado.

FX & Rates

<p>In a speech that was largely an historical account of the evolution of policy, Chair Yellen emphasized a gradual pace of policy tightening, while sending a clear signal that, barring a surprise, a hike on 15 March is planned.</p><p>The USD has weakened on the speech mainly because Yellen has given no indication that the Fed has changed its mind since December on the pace of rate hikes (three this year).  And she reiterated that this was the position of the FOMC in December.</p><p>Nevertheless, since they are…</p>

In a speech that was largely an historical account of the evolution of policy, Chair Yellen emphasized a gradual pace of policy tightening, while sending a clear signal that, barring a surprise, a hike on 15 March is planned.The USD has weakened on the speech mainly because Yellen has given no indication that the Fed has changed its mind since December on the pace of rate hikes (three this year).  And she reiterated that this was the position of the FOMC in December.Nevertheless, since they are…

Yellen Greenlights March, Emphasizes Gradual, but Risks Have Shifted Toward More Hikes This Year

<p><em>Alternative measures of core inflation in the US, including the Dallas Fed’s PCE trimmed mean measures, show inflation is now very close to the Fed’s mandate and in a rising trend.  Core CPI measures, including the Cleveland Fed’s trimmed mean and median, are well above the mandate.  Inflation trends globally appear to have turned higher, including in China, the USA’s biggest source of imported goods.  The NY Fed’s survey of inflation expectations was at an 18-month high in January.  Jobless claims were at a record low last week, and a range of activity indicators show rising and above trend growth; including the ISM manufacturing new orders index rising in February to equal the peak in 2013.  While there has been much focus on Trump’s economic policy proposals, current indicators suggest that the Fed may have fallen behind the curve.  Apart from hiking on 15 March, now widely expected, the Fed may also upgrade its forecast for rates and its risk assessment.  The USD has significantly underperformed the improvement in its yield advantage over the last 18 months.  Even though the USD is at historically high levels, compared to relative interest rates, it now appears cheap against most currency pairs.  The NZD appears to be one of the most over-valued currencies compared to yield spreads and would be vulnerable to any pullback in global risk appetite or a further rise in global bond yields.</em></p>

Alternative measures of core inflation in the US, including the Dallas Fed’s PCE trimmed mean measures, show inflation is now very close to the Fed’s mandate and in a rising trend.  Core CPI measures, including the Cleveland Fed’s trimmed mean and median, are well above the mandate.  Inflation trends globally appear to have turned higher, including in China, the USA’s biggest source of imported goods.  The NY Fed’s survey of inflation expectations was at an 18-month high in January.  Jobless claims were at a record low last week, and a range of activity indicators show rising and above trend growth; including the ISM manufacturing new orders index rising in February to equal the peak in 2013.  While there has been much focus on Trump’s economic policy proposals, current indicators suggest that the Fed may have fallen behind the curve.  Apart from hiking on 15 March, now widely expected, the Fed may also upgrade its forecast for rates and its risk assessment.  The USD has significantly underperformed the improvement in its yield advantage over the last 18 months.  Even though the USD is at historically high levels, compared to relative interest rates, it now appears cheap against most currency pairs.  The NZD appears to be one of the most over-valued currencies compared to yield spreads and would be vulnerable to any pullback in global risk appetite or a further rise in global bond yields.

Fed Already Behind the Curve, USD Looks Cheap Compared to Yield Gaps, NZD Expensive

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Thomas Schroeder

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Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Technical Analysis

<p><strong>Chartonics webcast </strong>Wednesday 1 March 2017</p><div><strong>USD rally sequence</strong></div><p>To view click on this link: <strong><a href="http://www.screencast.com/t/Z96hDgpULaxr" target="_blank" data-saferedirecturl="https://www.google.com/url?hl=en&amp;q=http://www.screencast.com/t/Z96hDgpULaxr&amp;source=gmail&amp;ust=1488436094483000&amp;usg=AFQjCNFKjHZynmAF_btWsDTx_wCmsVi0mw">http://www.screencast.com/t/Z96hDgpULaxr</a> </strong>10:04 min.</p><div>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/021/754/original/CPG%20FRONT%20COVER.png?1488349798" class="editor-image img-responsive" data-smartkarma-image-id="21754"></figure><div class="content-caption">FX webcast</div>
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<strong>T-Note top in line with yield spike call</strong>. After a sharp drop in the T-Note price we touted from 125.60, we face an uptick sequence on any Trump disappointment given pattern support lies at 124.50. The real test comes with Yellen and NFP Friday. Again this rising wedge pattern implies a downside surprise in price action/upside surprise in yield in…</div>

Chartonics webcast Wednesday 1 March 2017USD rally sequenceTo view click on this link: http://www.screencast.com/t/Z96hDgpULaxr 10:04 min.
FX webcast

T-Note top in line with yield spike call. After a sharp drop in the T-Note price we touted from 125.60, we face an uptick sequence on any Trump disappointment given pattern support lies at 124.50. The real test comes with Yellen and NFP Friday. Again this rising wedge pattern implies a downside surprise in price action/upside surprise in yield in…

USD Rally Sequence on Back of Yield Surprise

<p><em>Fed speakers have raised the probability of a 15 March rate hike.  They appear to see the next meeting as offering a window of opportunity to get ahead of a three hike agenda this year, allowing the Fed more space to assess conditions through the middle part of the year in an environment of heightened US government policy uncertainty.  Dudley highlighted the sharp </em>pick-up<em> in consumer and small business optimism and easier financial conditions generated by the strong stock market and narrower credit spreads.  The weaker USD this year may also allow space for Fed policy tightening.  While there has been little evidence of the ‘Trump bump’ flowing through to real activity, Dudley still sees the economy operating somewhat above trend and progress towards the Fed’s dual mandate.  The Fed’s Williams added that the Fed is close to achieving its dual mandate. In recent months, the USD has responded negatively to USA policy uncertainty and growing doubts over the capacity of the Trump administration to deliver on its initial promise. In fact, the USD appears to have significantly </em>underperformed<em> its improved yield advantage over the last year.  We continue to see a topsy-turvy FX market this year, but Fed policy tightening may help boost the USD in the near term.</em></p>

Fed speakers have raised the probability of a 15 March rate hike.  They appear to see the next meeting as offering a window of opportunity to get ahead of a three hike agenda this year, allowing the Fed more space to assess conditions through the middle part of the year in an environment of heightened US government policy uncertainty.  Dudley highlighted the sharp pick-up in consumer and small business optimism and easier financial conditions generated by the strong stock market and narrower credit spreads.  The weaker USD this year may also allow space for Fed policy tightening.  While there has been little evidence of the ‘Trump bump’ flowing through to real activity, Dudley still sees the economy operating somewhat above trend and progress towards the Fed’s dual mandate.  The Fed’s Williams added that the Fed is close to achieving its dual mandate. In recent months, the USD has responded negatively to USA policy uncertainty and growing doubts over the capacity of the Trump administration to deliver on its initial promise. In fact, the USD appears to have significantly underperformed its improved yield advantage over the last year.  We continue to see a topsy-turvy FX market this year, but Fed policy tightening may help boost the USD in the near term.

<p><em>Mnuchin and Trump reinforce a growing impression that the US administration wants to reset US global trade relations and they prefer a weaker US dollar.  Rising uncertainty of over progress towards US tax reform appears to be undermining confidence in the US economic recovery and the USD.  Emerging and commodity currencies have benefitted this year from stronger global economic indicators, a weaker USD and as a haven from Eurozone and Brexit political risk. These gains may stall, at least against JPY and gold, if global uncertainty remains elevated. Even though the USD is broadly weaker in recent days, metals prices have fallen.  This may be a sign that some of the confidence in the global economy is slipping. On Wednesday, the Fed minutes outlined its concern over government policy uncertainty. Some Fed members thought the US equity market was frothy and further dollar strength could dampen growth and inflation. </em></p>

Mnuchin and Trump reinforce a growing impression that the US administration wants to reset US global trade relations and they prefer a weaker US dollar.  Rising uncertainty of over progress towards US tax reform appears to be undermining confidence in the US economic recovery and the USD.  Emerging and commodity currencies have benefitted this year from stronger global economic indicators, a weaker USD and as a haven from Eurozone and Brexit political risk. These gains may stall, at least against JPY and gold, if global uncertainty remains elevated. Even though the USD is broadly weaker in recent days, metals prices have fallen.  This may be a sign that some of the confidence in the global economy is slipping. On Wednesday, the Fed minutes outlined its concern over government policy uncertainty. Some Fed members thought the US equity market was frothy and further dollar strength could dampen growth and inflation. 

United States

The euro is the official currency of the European Economic & Monetary Union.  The US dollar is the official currency of the United States of America.

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Yellen Greenlights March, Emphasizes Gradual, but Risks Have Shifted Toward More Hikes This Year

In a speech that was largely an historical account of the evolution of policy, Chair Yellen emphasized a gradual pace of policy tightening, while...

Greg Gibbs

Fed Already Behind the Curve, USD Looks Cheap Compared to Yield Gaps, NZD Expensive

Alternative measures of core inflation in the US, including the Dallas Fed’s PCE trimmed mean measures, show inflation is now very close to the...

Greg Gibbs

USD Rally Sequence on Back of Yield Surprise

Chartonics webcast Wednesday 1 March 2017USD rally sequenceTo view click on this link: http://www.screencast.com/t/Z96hDgpULaxr 10:04 min. T-Note...

Thomas Schroeder

Fed Seeks to Get Ahead of the Curve

Fed speakers have raised the probability of a 15 March rate hike. They appear to see the next meeting as offering a window of opportunity to get...

Greg Gibbs

Mnuchin Takes a BAT to the Dollar

Mnuchin and Trump reinforce a growing impression that the US administration wants to reset US global trade relations and they prefer a weaker US...

Greg Gibbs

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