Can The Dollar Deduce A Super Bull Market? How Does The Exchange Market Operation Start?

Over the past few days, the trend of US dollar exchange rate has changed, and the overall strength of the US dollar has become more "broad", especially against commodity currencies, even though emerging market currencies are relatively flexible.

Like the early 1980s and the late 1990s, the "super large" rally is now in force.

It is difficult to achieve this, but there are several specific factors that are expected to help the US dollar stand out in the financial market.

The important point is that the inflation situation is in a low ebb, so the FED will probably have time and space to think about when to tighten monetary policy.

In addition, the global capital market has a deep draught. The risk assets of the United States are facing competition from similar products in the global financial market, including emerging markets.

Therefore, the influx of capital into the United States will not happen, especially when people doubt the long-term economic growth.

Our core expectation is that

The gradual upward trend will continue to release a good upward momentum in the next 6 months, because the Fed's rate hike is expected to gradually ferment, and the US dollar's bear market market strategy pformation in the past 10 years will also help.

The rise of the US dollar will largely depend on whether the Fed wants to show hawkish positions or adopt a defensive stance.

The two policy positions are likely to be pursued by the Federal Reserve: if the US economy fails to anticipate a slowdown, the current US dollar appreciation is likely to die out, and the Fed will also show concern about the slowdown in overall inflation.

If the eurozone worsens, it will lead to the emergence of the region.

The tightening of the situation, then the rise of the dollar against the euro will go beyond our core forecasts.

In terms of operations, we are still sticking to the US dollar position against the yen and the euro (all in the way of holding dollar options), but we are also looking for more entry points for us dollar to other more assets, including the US dollar against emerging market currencies, especially when the US Federal Open Market Committee (FOMC) announcement is coming.

The current rise in the US dollar may not reach the previous extreme level, but we believe that the structural strength of the current round is expected to become a super bull market in the history of the US dollar after 80 and 90 years of last century.