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Investing.com - Bank of America has identified a broadening trend reversal signal favoring a stronger U.S. dollar against major G10 currencies, according to a research note dated June 30, 2025.
The bank’s analysis now shows explicit trend reversal signals supporting USD strength against the euro, Japanese yen, British pound, Canadian dollar, and New Zealand dollar, following resilient U.S. payrolls data that triggered a dollar rally.
BofA notes that front-end option flows no longer anticipate further short-term USD downside, while up/down volatilities have turned bullish on the dollar at what the bank considers oversold spot levels.
The research firm has adopted a tactically bullish stance on USD versus the Canadian dollar, expecting net job losses for Canada after four consecutive months of weak labor data, and noting USD/CAD typically experiences large moves when Canadian employment data is released on different days than U.S. payrolls figures.
BofA also turned bullish on USD/JPY as its CARS model exited macro shock regime, with option flows broadly moving toward Japanese yen puts, though the bank cautions that details of tariff letters expected this week could potentially shift market narrative against the dollar.
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