Position takers beware, it’s still a traders market: by Sean Lee

The extreme volatility of last week may ease somewhat today, with a holiday in the US tonight, but will resurface with the big ECB meeting later in the week. I’d be very wary about running any ‘conviction positions’ in these market conditions especially if you are on the same side as the rest of the market. We may yet see some further positional adjustments as the fall-out from Thursday continues.

These are the trades I like for the week ahead:

Gold: Buy dips here is the clearest trade in my opinion and we could see prices up around $1400 pretty quickly if shorts get spooked again;
USD/JPY: Definite bearish bias here, just need to sit tight and wait for the right entry levels;
EUR/USD: Bearish bias here also but with positioning at extreme levels, we need to be wary of sharp short-covering spikes;
AUD/USD: Bullish bias here for me and I think we could see .8400 this week;
Cable: I’ve reverted to neutral here in short-term ahead of the BoE.

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