USD bulls need a new catalyst

Research evidence excerpt

USD bulls need a new catalyst

ht primer - 1 Apr

worsening (Exhibit 8). ‘25.

Our fundamental view remains tactically bullish USD (see report: FX Weekly, 3 Jul ‘26).

However, the more cautious quant backdrop suggests a fresh catalyst may be needed for

the rally to extend, and another downside surprise in US data could easily trigger a For a list of open trade

deeper pullback. As a result, crosses look more attractive this week. recommendations and trade

recommendations closed in the last

Keep calm and carry on in GBPCHF 12 months, please see Global FX

Weekly.Last week, we flagged GBPCHF as an attractive pair to benefit from carry as vols grind

lower through the summer (see report: FX Vol insight, 1 Jul ‘26). This week's quant

signals reinforce that view. Option flow, skew, and cross-asset signals have all turned

meaningfully GBP-positive (Exhibit 2, Exhibit 9) while a bullish continuation signal, Glossary:

supported by a constructive ADX trend, suggests the GBPCHF uptrend has further to run CARS (model): Cross-Asset Regime

(Exhibit 8, Chart 1). Additionally, no major G10 cross offers higher vol-adjusted carry Switching

(Exhibit 7). SDR: Swap Data Repository

MAA: Moving Average Aggregator

Fundamentals also support further upside in the cross. Tech- and AI-related M&A flows

UD: Up/Down volatility

should keep GBP supported near-term (see report: Liquid Insight, 1 Jun ’26), while the

RS: Residual Skew

SNB's "increased willingness" to intervene in FX markets should limit CHF appreciation.

ADX: Average Directional Movement Index

DMI: Directional Movement Index

Trading ideas and investment strategies discussed herein may give rise to significant risk and are SMA: Simple Moving Averagenot suitable for all investors.