#NZD basics

The last few months #NZD values dropped considerably in relation with most other currencies.  Various explanations can be given for that, some common, some individual for each pair, but the main factor that affected #NZD was political (and almost all research teams agree to that).  The elections and the change in Government affected #NZD heavily.

What will be the outlook of #NZD against other currencies is matter of debate and opinions between researchers teams vary.
Before mentioning the future outlook given by some institutional research teams, some factors that are very likely to influence #NZD will be mentioned.

• FED starting December 2017 will increase its rate.  This is probable to happen once or even twice again in 2018. 
• RBNZ is not likely to move its interest rate any time soon.
• A change in RBNZ's mandate via an introduction of an employment component remains a possibility.
• The possible introduction of a rate setting  committee in RBNZ also remains unclear.  So Central Bank's independence is a worrying factor for the markets.
• GDP growth is expected to be lower in 2018.
• Housing market is expected to be weak.
• Political uncertainty may continue in 2018.

Most research teams generally agree to these factors, but they differ greatly on the particular weight of each one on #NZD.
Some consider it as undervalued and they see its behavior the last days as he beginning of new trend, and other see it as a "spike" in the charts and an opportunity to enter long - term short positions.

A brief long -term outlook of the currencies traded against #NZD (of the pairs that will be examined here) is as follows:

#EUR
The #EURO area is producing solid economic data and this is expected to continue for the next quarters.  Although ECB's steps towards normalization are slow and the rate is not expected to change until the last quarter of 2018, the language of the Bank is likely to change earlier.  As far as politics are concerned, after Brexit and the #EUR crisis markets are more resilient and flexible, and much more confident towards the EU.

#USD
US data is also solid and is expected to be the same in 2018.  Factors like the possible rate hikes, the corporate tax, soft current account, midterm elections, a focus of the market in the Euro, etc are factors that cannot be easily priced in.  They could drive #USD up or they could lead to a small depreciation.  If the latter happens, it is not expected to be something dramatic.
Trumpnomics and erratic political behavior is and will remain a concern for the markets.

#JPY
BOJ is not likely to change its policy especially after the result of the elections.  Abenomics are likely to continue.
However, markets are starting to consider the "reversal rate" effects on banking and on the economy in general.  Although  BOJ has stated that they do not see any serious danger at the moment, even a slight change in their rhetoric in the next months signalling that edging away from its current policy is a possibility, could lead to reversal for #JPY

#CHF
SNB continues to consider #CHF overvalued.  No change in policy is expected.  The target is around 1.20 against the #EUR.

#GBP
Uncertainty and volatility will be the characteristic of #GBP throughout the duration of the trade negotiations with the EU.  Any outlook for the long term will be purely speculative.
However, since a "no deal" or a "bad deal" scenario makes no economic sense but more importantly it makes no political sense for the pro-Brexit politicians since it would probably lead to their political demise, a collapse of the talks and hence of #GBP is considered highly unlikely.

#AUD
 A factor that will have great influence on the moves and direction of #AUD is the RBA monetary policy.  There is no indication that a rate hike will happen any time soon.  On the contrary the consensus is that if it happens it will be the end of 2018.
Commodity prices are  another factor that has heavy influence on #AUD. Analysts mostly agree that commodity prices look set to fall.  Some suggest a greater than 20% fall in the bulk Commodity Index and a greater than 25% fall in iron ore price. China's reform policies and the consequent slowdown in its industrial demand, will have an additional effect.

Based on the above, each individual #NZD pair will be discussed in a different post.

#XPDUSD Medium / Long term Outlook and Positioning

The factors that fundamentally influence the price of ##XPDUSD are the following.

• Vehicle demand.  This amounts for more than 60% of Palladium demand.  The forecast for the automotive industry for 2018 is positive.
• The stockpiles are not released by the Russian government so this is an unknown factor.  Any sanctions to Russia affecting its exports of the metal (very unlikely to happen) will affect its price since it is one of the two the largest producers in the world.  The relation of USD with the ruble can also affect the price.
• South Africa is the second and political unrest combined with prolonged strikes, increasing mining costs etc could influence the price.
• Recycling.  A lot of vehicles have reached the ten year cycle and the recycling of their catalysts could affect the price (rather small impact)

However, these are not as likely to affect heavily the price of palladium or to cause sudden price fluctuations and unexpected volatility, as institutional investors are.  And this includes large speculative hedge funds.

The palladium market is thin and it is very susceptible to such events.

What is happening in the ETF and the futures market is what drives the price.  

And to make a valid prediction on what happens in such a speculative environment is almost impossible.  Therefore it comes as no surprise that  the price collapse of 2015 was not predicted but merely explained as it was unfolding by most analysts. 

The question to ask is, will the market reach a state of contango and when?  According to some research teams this could happen in the next few months.  Others argue that there is going to be a higher than expected demand from the auto industry and this will drive the price up.

In the first scenario the price could dive to 890 and if it crosses that, then 820 is a possibility. 

In the second scenario, the price could test new highs.  And that is that.  It does not exclude a major pullback.  It just transfers it further in the future.   

The main issue in the first scenario is that if it materializes it could easily unfold in a matter of few weeks, and it could easily be with very few, if any, price retracements of a considerable size.  In fact it is very common for speculators to act "en masse", so a price plunge rather than a gradual drop is quite probable.

So, is "jumping of" the current well established trend the preferred action?  Fundamentally speaking it is not justified.  But as stated above, it is not likely that fundamentals will will be the main factor of influence.

The choice seems to be purely speculative.

Provided that the strategy followed (ie the number of orders, their sizing, the current capital, and the ability to support open positions) is adequate to withstand the scenario that the price drops without major retracements to around 800, then positioning should be long.

The speculative assumption is this positioning strategy is that the price will not go below 800 which is already a very big distance from current levels.

This assumption could be proven wrong, given that the price of XPDUSD is determined not by its true value (value driven by physical demand) but by futures and ETFs.  The pull back will happen when speculative funds liquidate their long positions and 800 may not be the bottom of the fall.

Short positioning assumes that the current rally is out of steam and that the pull back will happen soon.  Palladium is highly overvalued and speculative funds will liquidate sooner than later to secure profits.  This is a valid assumption.  The time factor though is an unknown and hence speculative.

The deciding factor in drawing a valid strategy with the least amount of speculation in it, is the following:

There is a supply deficit in palladium.  Some calculate it to around 1 million ounces and some some others to 1.4 million ounces.  And this is a deficit in the physical supply.  There is no financial speculation involved.  For 2018 all projections suggest that this deficit will grow considerably. 

At the same time demand is growing globally driven by the auto industry which is projected to grow globally in 2018.

So, the pullback will eventually happen since the current price does not represent physical demand but it includes a large amount of speculative funds.  When this will happen cannot be predicted in any way.

Although not impossible, it is not likely that the price will fall below 800 when the pullback happens, since there is a a large deficit in supply and demand is likely to grow.

Taking the above into account, positioning in the medium / long term is long in a rather conservative and definitely not in an aggressive way. 

 

#EURSEK #EURNOK #USDSEK #USDNOK Medium / Long term Outlook and Positioning

Before examining each currency, one factor must be mentioned that is common for all of them.  For all of the respective economies  there is not a fundamental factor (political or economic) that would justify a high probability of a very big change (by long term standards) in the value of its currency  in either direction (appreciation or depreciation).

In brief, the main factors that will affect each individual currency in the medium to long term are:

#SEK

• Concerns about the housing market.  
• Riksbank is expected to announce the end of QE in the December meeting, and turn hawkish.  A change in its rate is expected early in 2018.

#NOK

• Concerns about the housing market
• Oil prices and #NOK value not necessarily correlated

• NB will probably leave rate unchanged until at least Q3 2018
• Spill over effects form possible issues in the Swedish housing market

#EUR

• The EU produces good and solid economic data.  There is no indication that there will be any dramatic change in that.
• After the #EUR and the Brexit crisis markets have renewed confidence in the EU.  They show resilience and confidence in EU politics.
• ECB is the slower in following the normalization path.  However this process has already started albeit in slow steps.

#USD

• FED will most probably turn hawkish this week.  A rate increase is quite probable to happen again once or twice next year.
• US data is good and there is nothing to suggest that this might change dramatically. 
• Business surveys show strong positive sentiment in the economy and the equity market is on the uptrend
• The Trump administration might not want a strong dollar - New FED chair is a relatively unknown factor (same applies for its relationship with the Trump administration) 

Most institutional research teams consider both #NOK and # SEK to be undervalued both against #EUR and  #USD.

Barclays: For #EURSEK a gradual from from current levels  to 9.30 by Q4 2108.  The same for #EURNOK with a value of 9.25.

CIBC:  A gradual drop to  a value of 9.0 for both by the end of Q4 2018.

UBS:  For #EURSEK a gradual drop from current levels  to 9.20 by Q4 2108.  The same for #EURNOK with a value of 9.10.

Societe Generale: They see #EURNOK at 9.1 for Q1 and Q2, 9.20 for Q3 and 9.15 for Q4.  For #USDNOK they see a gradual drop to 7.2 by the end of Q4 and the same for USDSEK to 7..17.

Danske Research: #EURNOK gradually to 9.10 by Q4.  #EURSEK Q1 10.1, and then gradually drop to 9.7 by Q4.  #USDNOK gradually to 7.28 by Q4.  #USDSEK 8.71 Q1 and then gradually drop to 7.76 by Q4. 

Handelsbanken: #EURNOK 9.20 Q1, #EURSEK 8.45 Q1, #USDNOK 8.14 Q1 #USDSEK 8.36 Q1

Below are H4, Daily and Weekly charts for #EURNOK and #EURSEK.

#EURNOK H4

#EURNOK Daily

#EURNOK Weekly

#EURSEK H4

#EURSEK Daily

#EURSEK Weekly

The uptrend on which both pairs are, is clear as expected.

For #USDNOK and #USDSEK, the charts are as follows:

#USDNOK H4

#USDNOK Daily

#USDNOK Weekly

#USDSEK H4

#USDSEK Daily

#USDSEK Weekly

No trend can be identified neither on #USDSEK nor on #USDNOK.  In both we are above the long term EMAs on the Daily and on the Weekly charts.

The economic fundamentals do not provide any strong bias for any of these pairs.

Most research teams are suggesting that there will be a trend reversal and hence long term positioning should be made accordingly.

So the question is:  Is "jumping of" the current trends and start positioning against them the best course to follow at the moment?

The answer to that is at the moment no.  To position against the trend requires extremely strong evidence that a trend reversal is imminent or at least a very big change in the rate is imminent for which there is sufficient evidence that might provide the momentum for a trend reversal.

There is nothing to suggest that. 

For #EURSEK and #EURNOK by taking account the fundamentals,  and at the same time by looking at the charts, it could be intuitively said that yes, a gradual reversal might happen leading  to 9.3 or even lower.  But it is not a certainty.  And even if it happened it would not be a sudden drop but rather a bearish range that could lead to this level.  

This type of movement can be traded both ways.

For #USDNOK and #USDSEK a drop to 7.2 would mean a very strong downtrend throughout the next 4 quarters.

The only factor that could justify that would be a very weak #USD across the board.  There is nothing to suggest at the moment that #USD will have such a path during the next quarters.

Medium and long term positioning for all pairs, remains long with caution, meaning relatively tight TP levels, and distance between orders relative to the volatility.  If volatility continues as it is the last months the distance could be relatively tight.  

Update 14 December 2017

#EURSEK Range q1 q3 2018

#EURNOK Range q1 q4 2018

#USDSEK Range q1 q4 2018

#USDNOK Range q1 q4 2018

#USDZAR #EURZAR Medium / Long term Outlook and Positioning

There are some fundamentals about these two pairs that are generally accepted as facts by the markets and various research teams.

There are no major dangers on the EU economy in the horizon.  The opposite is expected for 2018.  This refers to the economic fundamentals as well as the political.
#EUR is in a general strengthening path.  To what degree this will extend for the coming quarters is a matter of debate, but most analysts suggest that this will be the case.  In any case even the pessimists suggest a "stagnation" and not a reversal in its current general trend.
To that it must be added that the path to normalization by ECB has begun albeit in small steps.  This is expected to  continue.

On the #USD front there is more or less the same picture.  FED is expected to raise the rates next week.  Many analysts believe that this major step towards normalization will be the first  of two or even three rate hikes that could happen during 2018.
On the other hand of course there is some uncertainty after the change in FED's chair.  On top of that is the unpredictability that comes with the Trump administration which could prefer a rather weak #USD.  Lastly, political pressure  by the administration into FED's decisions and strategies is something that the markets do not exclude.
Having said that there are no major dangers to the US economy for 2018.

The South African economy is expected by various sources to expand slightly and its GDP to rise slightly in comparison with that of 2017.  But, there are three factors that could negatively influence this fragile projection.
One is commodity prices.  There is no major surprises in precious metals expected during 2018.  Platinum demand which is quite important for South Africa, is expected to remain at current levels.  Gold price is a much more unpredictable factor.    Gold is usually inversely correlated with #USD.  Given the fact that #USD is expected to strengthen  simply because of FED;s policy, gold is not expected to rise.
Coal and iron - ore are very different cases though.  The consensus is that no major rise in price is probable.  In fact it is very probable to see a considerable drop.
A second factor is political uncertainty.  The nomination of the next ANC president will happen in the middle of this month.  Mr Ramaphosa is seen as a reformist and his possible election as the next ANC leader and next South African President given ANC's dominance, will be seen with a positive eye by the markets.
The third issue is the credit ratings of the country's debt.  Things on this front look pessimistic.  If Moody's changes from review for downgrade to downgrade then local bonds will be expelled form the World Bond Index and this will have a significantly negative influence on the country's finances.  The date to watch is next February when the next review will be published.

Given the above, both pairs should have been on a clear uptrend even with low momentum.  But this is not the case (in the short term).  The last weeks #ZAR has been surprisingly strong.
Various reasons may have led to this.  Two that might be the most influential are the following:
The markets have gradually priced in a positive political outcome in the ANC presidential race is one.
The second is speculative behavior.  While credit downgrades push institutional investors out of the country and hence applying pressure on the rand, they might draw in speculators.  The latter see this as an opportunity since the rand is cheap and the yields are high.

Institutional research teams  give the following outlook for the rand.
ING sees #USDZAR at around 14.5 by the end of 2018.This is a significant rise form its current levels.  However they suggest that spikes in the price are very probable and that volatility will be relatively high.
Danske see the #USDZAR ranging at around 14 during the first 3 quarters of 2018 before dropping at 13.30 during Q4 2018.

Mathematical models based on statistics and historical data suggest a gradual (but not uniform, meaning it will have periods of range) drop of #USDZAR to 12.7.

The picture we get from a technical point of view concerning the trend is the following:

#EURZAR H4

#EURZAR Daily

#EURZAR Weekly

It can bee seen, as expected, that there is no break in trend in the Daily Chart, no significant change in the Weekly, and change in trend in H4 which photographs the strength of #ZAR witnessed the last days.

#USDZAR H4

#USDZAR Daily

#USDZAR Weekly

On #USDZAR there is no trend in Daily and Weekly charts, and on H4 the beginning of a possible trend reversal can be seen.  

A rational way to interpret the above is as follows:

#ZAR will be affected by politics.  In the short term, the ANC presidency and the likely election of Mr.  Ramaphosa, could strengthen #ZAR even more.  It will probably do that, since his possible win is not yest fully priced in by the markets.  Some analysts suggest that if this event is fully priced in this could lead to a #USDZAR price of 12.50 or even 12 (and also have a similar effect on #EURZAR).  This forecast has a great degree of speculation in it, but if it breaks 13 then momentum and market sentiment might kick in even harder and a further drop is certainly a possibility.  Others suggest that a market positive ANC result will reflect to a price of 13.5.  This sounds more reasonable.  Let us not forget also that ANC nomination is after the FED decision.  If as expected #USD is stronger by then, breaking the 13 barrier will be a lot harder.
In the long rum it remains to be seen if the new president is willing and capable to proceed with the necessary reforms and this will be priced in accordingly by the markets.  This however will have a gradual effect on the price of these pairs.  It will be a  secondary factor,  that will be added to the primary factors that will affect the pair during the next months.

The credit rating results outlook is negative.  It is highly probable that Moody's will follow the other two and it will proceed with a downgrade. In theory this will apply pressure on the rand.  It is not improbable though to see a repetition of the speculative scenario described above.  It is highly unlikely though that this could strengthen the rand in a sustainable way.

#EUR is not probable to show any sustainable or considerable weakness.

#USD will get a push by the FED rate hike(s ?).

Given the state of the South African economy and the predictions for 2018 SARB is a lot more likely to cut rates than to increase them.  The latter at the moment seems an impossibility.

Volatility and lots of ranging is the conclusion that can be drawn with relative safety. 
In the long run though, it seems that until at least the beginning of the 3rd quarter #ZAR will be weaker in both pairs compared with its current levels.  
Lastly, there is no fundamental justification to "jump of" the trends that are visible on the charts or "jump in" to trends that have not yet established.

So positioning for the medium to long term is at the moment long both for #EURZAR and for #USDZAR.

Update 14 December 2017
Positive political news during the last weeks, and  "lazy" #USD (even after the rate increase) and #EUR have helped #ZAR.
This weekend's election is not yet priced in and could cause high volatility (in short term standards).  Marginal win of either side could push #ZAR low, a decisive win could push it high or low depending on who wins.  Prices above or close to 14 and close or lower than 13 are probable.

Despite the result of the elections, the outcome of the pair remains unchanged.  For #ZAR to gain strength and start to rise in the long term  a U turn in political rhetoric and in most importantly in the policies applied will be required.  And this is not likely.

A negative result will be an opportunity to start building long positions.  A positive result by no means will signal the building of sell positions.

#USDMXN Medium / Long term Outlook and Positioning

The factors that will have a major influence on the direction of  #USDMXN through 2018 are the following:


NAFTA talks.
There is no way to forecast a possible outcome of these talks.  However, given the rhetoric of President Trump on the issue, a fully positive outcome does not seem a probable scenario.  Many analysts are forecasting negative scenarios without excluding the possibility of a breakdown in talks soon.  According to these sources demands made by the US on key issues are no-gos for Mexico.  Goldman Sachs is one of them and expect the US  to announce its intention to pull out of NAFTA.

This would cause a shock on #USDMXN and if it is actually carried through it is expected to have a major effect on the Mexican economy as its exports to the US account to approximately 28% of its GDP.  This number alone indicates that any negative outcome of NAFTA talks will have a negative impact on Mexico. 
There is  another political issue between Mexico and the Trump administration, namely the building of a border wall which was very high on the agenda of president Trump prior to the elections. It is obvious that this will also play a role on the US final decision on NAFTA purely because of political reasons and not because it has anything to do with economics and trade.  Internal US politics will also play a role on the outcome of NAFTA.

Lastly, the Trump administration has shown that it pushes through many of its controversial pre-election promises in domestic as well as in foreign issues.  So dropping NAFTA will not come as a surprise.

FED and Banxico  policies
If there was no NAFTA issues it would be very possible to have two very divergent policies.

FED on one side is looking set to continue its path to normalization.  A rate hike is expected during this month and many analysts give high probabilities for this to be repeated once or twice next year.

Banxico, without the probable uncertainties that there are in the horizon (NAFTA, and elections), would have to primarily consider the following two factors when determining its rate policy:
The current state of inflation (5,8% aprox average for 2017) and its forecast  (3.5% average for 2018 according to the IMF), and,
the  forecast of Real GDP growth (IMF gives it at 1.9%) which is actually a decline from that of 2017  (2.1% up to now).  (Many other research teams give a similar image on these figures).
So, under normal circumstances, Banxico should start gradually decreasing its rate.
This is not the case though.  In its upcoming meeting in December a rate hike is not out of the question but it is not probable.  However, as Banxico is quite vocal and loud in its statements, a very hawkish statement is very probable.
For sure there is the determination and the will to support #MXN.   But the number of "bullets" is limited.  The rate is high in relation to inflation and GDP current states and projections.  So it is most likely that Banxico will save its bullets for when they are most needed.
Can a preemptive strike be excluded?  No it cannot.
The previous day from the day Banxico will announce its decision, is the FED rate decision.  If FED proceeds with the increase and Banxico do the same, lots of volatility is the only certainty and nothing more than that.  If FED does not proceed with an increase then the argument would be that a Banxico increase would strengthen even more a relatively strong at the moment #MXN so that it is at a better position for the stormy months ahead.  This does not seem likely since it wastes a "bullet" and secures nothing.

US and Mexico economies on opposite paths
The US is widely accepted to retain its current overall positive outlook.  No major negative changes are expected during 2018.  Real GDP is expected to be the same next year at 2.1% and CPI inflation (q4/q4) to increase to 2.5%
On the other hand the Mexican economy is given a negative outlook by most research teams, in the sense that it will slow down (nothing dramatic but definitely a  slow down).

There is an obvious divergence in the outlook of the two economies.

Political situation
Elections are scheduled for July 2018 and as they approach the tones from politicians are going to be increased and the same the volatility of the pair and the pressure on the peso.
If there are negative developments on the NAFTA front, this effect will be multiplied.
And in order to give names to events so to have a clear picture, if Mr Obrador is ahead in the polls this means pressure to the peso and if he prevails in the elections this means even more pressure. 

How do all these factors add up?
Well, nothing can be excluded and nothing can be said with the degree of certainty that will exclude speculation.

Before reaching a conclusion, let's see some forecasts from some institutional research teams.

Nomura retains a negative outlook for #MXN mainly due to Trump Politics and NAFTA.

Goldman Sachs relates the price directly to NAFTA and the elections.  If NAFTA goes the wrong way (as they believe it is the most probable scenario) #MXN could reach 20-21.  If they add up the political risk then they project a value between 22 and 24.

Morgan Stanley suggests that it will range at around 18 for Q1 next year and then climb to 20 where it will stabilize.

CIBC Capital markets sees it between 19.1 and 19.3 for Q1 and Q2 and then ranging above 18.6 for the remaining two quarters.

Scotiabank sees a similar picture.  A range around 19 for all quarters.

Credit Agricole is more optimistic for the peso.  It sees a range around 18 for the first two quarters and a range around 17 for the second 2 quarters.

BBVA research sees a value of 18.5 for Q1, 19 for Q2, and then a drop to a range of 17.8 - 17.9 for the remaining two quarters.
It is worth mentioning that BBVA considers that the probabilities of a success in the NAFTA negotiations  have diminished.

Mathematical models based on statistics and historical data suggest that the price will range between 18.2 and 19.2 for the first semester of 2018 and then gradually drop to 17.30 by the end of the year.

Technical trend analysis shows what was expected.  That there is no indication for downwards trend change.

#USDMXN H4

#USDMXN Daily

As mentioned above any conclusion drawn, given the uncertainties that influence the pair will not be without a certain degree of speculation in it.

The probabilities of a successful NAFTA deal are very low.

Politics will add up considerably to the uncertainty and will apply pressure on #MXN

There is a divergence in the projected course of the US and Mexican economies that does not help the peso.

FED will most probably raise the rate at least twice.

But there are two unknown factors:

1. In what degree the markets have priced in the above and especially the probable NAFTA failure?
2. To what degree Banxico can support #MXN by increasing its rates?

Answering that is speculative.

However, it can be said that there is nothing at the moment to suggest that #MXN will strengthen in the short to medium term.

If FED increases its rate as expected during this month,  this will create a momentum and will lift #USD from the stagnation we have seen across the board the last weeks and give it some upward momentum.

My answer to the above two questions, is:

I do not believe that NAFTA is priced in by the markets, and any major negative development will apply considerable pressure on #MXN.

Banxico is likely to act to regulate the pressure of such event, but a rate hike will not revert the course of the pair in the long run that could leaad to a much stronger #MXN

Medium to long term positioning on #USDMXN is long with caution.  The pair could enter an uptrend but it could also range with a hawkish bias.  A good degree of volatility is to be expected.  

#EURCHF #USDCHF Medium / Long term Outlook and Positioning

The key factors that greatly determine the outlook of these pairs are the following:

• The economic data coming from the EU is strong and it is expected to continue being so during the next quarters.
• There is renewed and solid faith in the EU by international investors.  After the debt crisis, the Brexit crisis, and the subsequent weakening of populist movements across the EU, markets watch EU politics with resilience and confidence. 
• Brexit negotiations and their outcome are not likely to have any considerable or sustained effect on the #EUR
• ECB is slowly entering normalization mode and is expected to turn hawkish towards the end of 2018
• FED is expected to increase its rates during this moth.  Many analysts believe that this will happen again once or twice during 2018.
• SNB is not turning into normalization anytime soon.  Even in its communications it is very careful not to send any opposite signal.
• It is obvious that there is a strong divergence in Central Banks policies.
• #USD weakness over the last weeks opens the opportunity for new tactical medium - long term positioning 

The long term (Q1 to Q4 2018) forecasts from institutional analysts is as follows:

Nomura considers it likely for #EURCHF to reach 1.20.

BNP Paribas targets #USDCHF at 1.02.

Barclays expects #EURCHF to gradually climb towards 1.22 by the end of 2018 and #USDCHF to range close to its current levels between 0.98 and 1.00

NAB expects #USDCHF to range at 0.98

CIBC is one of the few that gives a negative outlook on #USDCHF for the next quarters with a value as low as 0.94, and in accordance with the rest gives a positive outlook on #EURCHF with a possible value of 1.18

Danske sees #EURCHF ranging at its current value for the next few months and picking up towards the middle of 2018 reaching 1.23.  #USDCHF outlook is a range in its current values.

UBS is expecting a #EURCHF climb to 1,2 - 1.22 and a #USDCHF range at 0.96 - 0.98

Societe Generale sees #EURCHF rising to 1.21 and #USDCHF ranging at 0.97-0.98

Scotiabank sees #EURCHF ranging around 1.14 throught 2018 and #USDCHF doing the same at 0.97 before dropping to a lower of 0.95 during the 2nd semester of 2018.

Mathematical models based on historical data produce an outlook for #EURCHF in which its price is at a gradual increase reaching 1.25 by the end of Q4 2018.   For #USDCHF the outlook is a gradual increase for Q1 and Q2 reaching 1.0 and then a reverse in price direction ending Q4 at 0.95.

From a technical point of view, as expected, the trend is obvious on #EURCHF on the Daily chart and on the weekly its price is well above the long term EMAs.
No trend can be identified in #USDCHF but it can be seen that the range is tight (in comparison with other pairs).

 #EURCHF Daily

#EURCHF Weekly

#USDCHF Daily 

#USDCHF Weekly

The levels in which the pairs are expected to move in the the coming quarters are:

#EURCHF

#USDCHF

Based on the above, medium long term positioning on #EURCHF is long.  

Given the current state of #USD and the upcoming (most probably) increase in FED rates, positioning is also long.  
A possible range in the price of #USDCHF could also be exploited because of the narrow width that the pair ranges. 

Given the range width of both pairs and the fact that no extreme moves are expected trading can be more aggressive.

Update 9/12/2017
Credit Agricole CIB FX Startegy, expects CHF rallies to stay sell in various pairs including #EURCHF.  The target for long positions is 1.18.
They base their argument on the fact the SNB still sonsiders #CHF to be overvalued.

#EURAUD #AUDUSD Medium and Long term outlook and positioning

Most analysts agree that #AUD will either underperform or range in relation with other currencies.  A few that supported the idea the it will rise have not been proven right in their future projections.

Nomura, recommends remaining long in #EURAUD and short in #AUDUSD

ANZ is giving the forecast shown in the picture below:

NAB maintains the following forecast (marked new):

WestPac has revised its previous forecast and expects #AUD to end 2018 at 0.70USD instead of 0.65

Commonwealth Bank is one of the few optimists:

Mathematical models based mainly on historical data, forecast a sharp decline on the #AUDUSD (dropping to 0.71)  until the middle of 2018, and a recovery to current levels by the end of 2018.
For the AUDEUR rate, the forecast is a decline in 2018 that could reach 0.55.

Trend indicators do not show any major trend on #AUDUSD at the moment.
However  as it can be seen, the price has decisively crossed large EMAs on the Daily chart and it is moving steadily below them on the weekly chart.

#AUDUSD Daily

#AUDUSD Weekly

On #EURAUD a clear uptrend can bee seen on the Daily chart and on the Weekly charts the price is decisively above large EMAs

#EURAUD Daily

#EURAUD Weekly

A factor that will have great influence on the moves and direction of #AUD is the RBA monetary policy.  There is no indication that a rate hike will happen any time soon.  On the contrary the consensus is that if it happens it will be the end of 2018.

Other central banks are planning (at least as the market expects) to proceed with rate hikes.  There is an obvious divergence in policies here that puts pressure on #AUD.

FED is widely expected to proceed with a rate hike during this month.  Although the markets have not priced this in yet, if it is delayed for early 2018 it will put further pressure on #USD.

However, a rate hike by FED is considered as a certainty by the markets.   Most analysts forecast that it will not be the only one, but merely the first of two or three hikes until the end of 2018.

The implications on #AUDUSD of this divergence in monetary policies between FED and RBA are obvious.

Commodity prices are a another factor that has heavy influence on #AUD. Analysts mostly agree that commodity prices look set to fall.  Some suggest a greater than 20% fall in the bulk Commodity Index and a greater than 25% fall in iron ore price. China's reform policies and the consequent slowdown in its industrial demand, will have an additional effect.

Economic data and forecasts suggest that the #EU will continue to improve throughout 2018 on its already good economic data, so the outlook is positive.

Politically it has emerged stronger after the #EUR crisis and #Brexit, and markets are not sensitive anymore to minor or medium range political events in the EU.

ECB continues to normalize its policy.

Based on the above, positioning for #EURAUD is long and for #AUDUSD is short, in the medium to long term.

As it seems highly unlikely for #AUD to turn bullish, a moderately more aggressive trading is not considered high risk.  

Update 8 December 17
https://twitter.com/dimitfx/status/939072210991501312

Update 8 December 17
Morgan Stanley sees a negative outlook for #AUDUSD for 2018.  It gives an estimate of a range between 0.76 and 0.77 for the first two quarters and a gradual decline to 0.67 for Q3 and Q4.
Their arguments include a reduced growth potential of the Australian economy.

Update 12 December 2018
UBS analysts argue that when house prices weakened towards flat or negative over a 6-month period, RBA cut the rates within months.  This happened in 7 out of 9 cycles.

Hence a rate cut is probable.
Other research teams maintain their position that the next rate move will be up and they position it towards the end of 2018.
BlackRock is one of them which positions the next hike on Q4 2018.

Update 14 December 17

#AUDUSD Levels q1 q4 2018

#EURAUD Levels q1 q4 2018