Audrey Freeman 2.0 3 ideas

"If you like the yuan, your best proxy in G10 is the Aussie... domestic international Aussie upside continues to make sense." The analyst identifies a structural shift in China's economy leading to currency strength. Since capital controls or liquidity can make trading the Yuan directly difficult for some, the Australian Dollar (AUD) serves as the liquid G10 proxy due to Australia's economic reliance on China. Additionally, domestic factors regarding the RBA's rate expectations provide a secondary tailwind. Long AUDUSD as a play on both China's recovery and Australian monetary policy. A resurgence in US economic data (US exceptionalism) or a failure in China's macro recovery.

"We've talked about the structurally bearish view on the dollar... the market ultimately needs the cyclical narrative on the dollar to turn." The dollar is viewed as structurally overvalued. While it is currently "churning" because the US economy hasn't collapsed, the analyst expects the weaker dollar story to unfold in the second half of the year once cyclical triggers appear. Short USD based on structural headwinds, pending a cyclical catalyst. The US economy rebounds in Q1 (as suggested by some forward-looking indicators), keeping the dollar strong.