USD/CHF ....WOW! How come I didn't see that?

[MARKETWAVES]

USD/CHF ....WOW! How come I didn't see that ?

USD/CHF ....WOW! How come I didn't see that ?



TRADE AT YOUR OWN RISK… The purpose of these charts is to point out significant highs and lows based on Fibonacci Retracement lines and Elliott Waves which are highly subjective. This information is for educational purposes and should not be considered trading recommendations. All trading decisions are your own sole responsibility …

 

[MARKETWAVES]

Re: USD/CHF ....WOW! How come I didn't see that ?

Here the result.....

NASTY .............. ABSOLUTELY NASTY !


YOU SAW IT HERE ... FIRST ......

 

[Wysiwyg]

Well the USD/CHF is at the lowest points in 30 years.With the French CPI figures being released next Thursday, does any Foreign Exchange dabblers have an experience of what a higher CPI (inflation) figure will mean to this pair.

A rising trend has a positive effect on the nation's currency. The primary objective of the central bank is to achieve price stability; when inflation rises above an annualized rate of approximately 2%, they will respond by raising interest rates to bring prices down. Higher interest rates attract foreign investment, thus increasing demand for the nation's currency.

Sooo ... will this mean a rise in the pair (from any previous experience) or a continuation of downtrend??Is the liquidity there.

 

[Stormin_Norman]

as an economist i see a appreciative currency for inflation quite curious. the currency market seems to view inflation as meaning interest rate rises, which attract capital due to the interest rate differential. attracting money appreciates the currency.

however, inflation itself devalues a currency by definition. 5% inflation means that the same money a year ago buys you 5% less goods now. the value of the currency has reduced. the lower inflation, the less the value of the currency reduces over time. therefore lower inflation figures should theoretically increase the value of the currency; but rarely do we see that in the short term.

the swiss franc is also an unusual beast. it is the 'banking' currency. all those with swiss bank accounts moving their money into or out of switzerland's financial institutions probably have a big influence on currency rates.

with global markets experiencing a sell off, and liquidity becoming more demanded, money is finding its way from the markets of the world back to swiss holding accounts. this is why their currency is so strong currently, in my belief.

as to how the swiss franc will react to inflation? i do not have enough experience in currency trading to tell you that. i am interested in other's experiences too.

 

[julius]

inflation has the same effect on all currencies (in theory)...the point of increasing interest rates is to raise real IR - the difference between inflation and risk free interest rate, creating an incentive/disincentive to spend.

the exchange rate naturally adjusts to the accomodate the difference between national interest rates due to the opportunity for arbitrage ie. Soros and the bank of england

 

[Wysiwyg]

Thanks Norman & julius.Well the 30 year low on the 1/2/08 was after a sharper (apart from the overall) downtrend so looking for a strong move up.Shall watch for any significant direction move and note these things. Maybe the EUR/CHF will make a move because at present it is undecided since 23-24/1/08.Probably need more significant data so i think i`ll just be quiet and watch all the same.Thanks again Norman.

 

[ithatheekret]

I think the Swissie could go either way , if it is pushed into any bidding area predetermined set and forget buy stops etc . , the chart below shows the trading channel , I expect it to break out of .

A lot is weighing on the Swissie , firstly UBS , after the stated previous writedowns , there's another $16/17 or 18B USD to be made up . That's a heavy weight for a currency to absorb , as a trader , I would be expecting a spout of weakness on anything the market hasn't built into the price or discounted . I see that 109 area as a ceiling , good resistance there from what I can observe . We could retest that , but I'm not expecting to much of a show past it , unless UBS manage to get a loan from their countrymen .

The 1.11 area looks like it was pulled up ....... twice . My Ockhams razor hat tells me there must be some good bids above that , in favour of the USD side of the equation . I'll pencil in that 109.8ish maybe 109.9ish as the top for the next run , it's a good 100 pip swing to 108.8's and there's always nicer numbers below it and traffic has tried to head that way recently .

Below 108.8's is the area I'd like to see revisited , as it opens up the previous high to be tested if strength continues . Before we get to trade to the bottom of that I expect POG will either retest it lower supports or break out to the upside as if it refuses to be pushed below the current nearest low .

If it retests , then ........... hello 1.11 area , if it breaks out mid 108s to high 107's for starters then we'll have to revisit the charts .

Inflation get's built into the price the in the days prior to when the data is released , the over shoots up or below the adjusted pricings corrects to a range acceptable on weighting . It just depends on what side you've taken in the market debate , unless you wait for the data prior to entry , when you should have been looking for signals before the data came out . I'd give the market a 7/10 for getting it right normally . It's the hidden messages that conflict with the facts already known to the market that causes upsets .

 

[Wysiwyg]

Thanks for that overview it`s a secret.I have yet to do foreign exchange (this week hopefully) so have some mistakes to make yet.I have a the next stage of proceedings with the USD/CHF.I would have gone short at the first downturn from the descending triangle with a discretionary exit point.I`ll see what happens.Looking for 10900 ish.

 

[Wysiwyg]

Well i`m only half way to target 10900 but on the closer up shot i noticed the widening rally steps and the time to move through each.Obviously the 10950 was a point of satisfaction and the present rally has me a little worried.I really have to stick with my belief that the downtrend will continue and with conviction shall hold my shorts.Good exercise for the big day anyway.

 

[>Apocalypto<]

I am short on the swissy.

E 10949
SL 10974

following Philip Nell's 4HourMACD system.

entered off market rhythm rules with a MACD pattern.

good piping!

 

[Wysiwyg]

Stop loss in imminent danger apocalypto after being eyeballed once already.The bounce off 10940 gathered momentum but luck with you 10970 might be resistance.

 

[>Apocalypto<]

Stop loss in imminent danger apocalypto after being eyeballed once already.The bounce off 10940 gathered momentum but luck with you 10970 might be resistance.

i sure was

Stopped out

 

[Kauri]

Turkey"s land offensive into Northern Iraq , and a rumour that a US bank might be looking to buy a Swiss bank (which one has uber money for that,they are selling themselves to SWF's as it is to survive??), are being assumed as factors in this morning"s USD/CHF weakness.

 

[>Apocalypto<]

Turkey"s land offensive into Northern Iraq , and a rumour that a US bank might be looking to buy a Swiss bank (which one has uber money for that,they are selling themselves to SWF's as it is to survive??), are being assumed as factors in this morning"s USD/CHF weakness.

cheers for that Kuari,

I am short the swissy now and his european cousin! eur/chf broke the 1 hour range. tight stops

 

[hangseng]

cheers for that Kuari,

I am short the swissy now and his european cousin! eur/chf broke the 1 hour range. tight stops

Being the contrarian I am, a little long for me target 10900

 

[>Apocalypto<]

Being the contrarian I am, a little long for me target 10900

i have closed out, good luck on your long

swissy + 17
eur/chf + 13

Good luck on the long HangSeng, I think I am going to call it a week.

 

[hangseng]

i have closed out, good luck on your long

swissy + 17
eur/chf + 13

Good luck on the long HangSeng, I think I am going to call it a week.

Well done, as usual I am a fruit cake and partial to a little risk taking. Just hanging in profit at present.

 

[hangseng]

and looking sad

oh well off to the next game it seems, lucky it was only a small play.

 

[hangseng]

Well I'll be!

Came back to see if I was out and managed to get out of that absolutely ridiculous ecision of mine with a wee profit after almost touching my stop.

BIG SIGH