EFTA02376179.pdf

From: Richard Kahn Sent: Tuesday, February 28, 2017 11:16 PM To: Jeffrey Epstein Subject: Fwd: FX BULLet: Five reasons to sell EUR/USD Richard Kahn HBRK Associa=es Inc. 575 Lexington Avenue, 4th Fl=or New York, NY 10022 Begin forwarded message: From: "Ens, Amanda" Date: February 28, 2017=at 5:0651PM EST To: "Rich Kahn" Subject: FX BULL=t: Five reasons to sell EUR/USD Reply-To: "Ens, Amanda" Can implement through FXE, the ETF. Recall our FX strategy also lik=s owning April expiry ATM puts. =nbsp; =span style="mso-bookmark:_MailOriginal"> BofA Merrill Lynch Global Research<=strong> <=pan style="mso-bookmark:_MailOriginal">Summary: FX strategy is bearish EUR/USD and are convicted i= should be sold, now. Here is why... 1. &n=sp; Three major event risks in=luding tax reform, the March FOMC meeting and the French election could wea=en the EUR and strengthen USD. 2. The recent divergence between EUR/USD positionin= and risk reversals reminds us of 2011 which witnessed a sharp EUR/USD sell=off. (Chart 1) 3. &=bsp; Differentials for c=re inflation, unemployment and 5y rate spreads would justify a weaker EUR/U=D in 1H17. (Chart 19-21) 4. Technical trend models recently broke down confirming t=e breakdown in the CEEREU, such as the EUR advance decline line of G9 curre=cies. (Chart 3, panel 1and 3) EFTA_R1_01385298 EFTA02376179 5. Spot EUR/USD formed a bearish flag pattern that s=ggests the 4Q16 decline and bearish momentum will continue. Support: 1.0490, 1.0350, 1.0025. Resistance: 1.0680= 1.08, and 1.1025 Chart=1: EUR/USD positioning and risk reversal diverge =nbsp; <1=> Technical Advant=ge: Euro chart pack • In this report, w= show EUR trends and technical breadth is still weak vs DM and may bounce v= EM. • EUR trends in DM are mostly down, except=EUR/JPY. EUR/GBP is forming a top. EUR/Oil has less downside left than real=zed. • Established downtrends in EUR/RUB and EU=/ZAR could bounce and should be sold. EUR/KRW may find support near an 11-y=ar low. Global Liquid Markets Weekly: What do we know (almost for sure)= • The interdependency between tax ref=rm, March FOMC mtg and the French election means selling EUR/USD is the rig=t trade now • The MXN would be a major benefici=ry if we are not correct. • In our annual mediu=-term oil outlook we now see Brent prices averaging $50 to $70/bbl through 2=22. =/tr> <http://rsch.baml.com/r?q=9o9FdjPJ80=2cA5chvPpmQ&e=richardkahnl2VA0gmail.com&h=lip-xw> <=pan style="font- family:"Arial","sans-serif";mso-farea=t-font-family:"Times New Roman";text-decoration:none;text-underli=e:none">FX Viewpoint: EUR in 2017 <http://r=ch.baml.com/r?q=9o9FdjP180m2cASchvPpmQ&e=richardkahn12%40gmail.com&=mp;h=Jip-xw> • We=expect weaker EUR short term, as the US delivers fiscal stimulus and market= get concerned about EZ political risks. • We s=e EUR strengthening in H2, as the EUR is undervalued, EZ data is improving,=and the ECB will taper QE. • We are long EUR/JP= for the year. Downside short-term risks an opportunity to buy.<=span> Back to top 2 EFTA_R1_01385299 EFTA02376180 * Read=the research report(s), available through the link(s) above, for complete i=formation including important disclosures and analyst certification(s). This sy=opsis, the research reports and the links to such report are for the use of=Bank of America Merrill Lynch customers only or Merrill Lynch Global Wealth=Management customers only and all copying, redistribution, retransmission, p=blication, and any other dissemination or use of the contents thereof are p=ohibited. There may be more recent information available. Please visit one o= the electronic venues that carry BofA Merrill Lynch Global Research report= or contact your Bank of America Merrill Lynch representative or Merrill Ly=ch Global Wealth Management representative for further information. 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