A strong US Dollar reversal led many of our trend-following trading strategies to close USD-short positions, and indeed the shift has prompted some systems to go long the US currency. Friday’s Nonfarm Payrolls sparked the long-overdue bounce that picked the USD off its lows. The question now becomes whether we can expect a more sustained US Dollar rally.
Our bias towards "Momentum" and "Breakout" systems brought mixed results through last week's trade. We clearly benefited when the EURUSD and GBPUSD rallied to fresh year-to-date peaks--Momentum1, Momentum2, and Breakout2 all floated sizeable gains on the US Dollar breakdown. Yet the reversal quickly pulled us out of said positions, and the slow-moving Momentum1 strategy gave up most of its previous gains. We are admittedly torn in establishing trading biases for the week ahead
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