Well The Swiss may just get more then they bargined for | Forex Factory

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Well The Swiss may just get more then they bargined for

  • #1
  • First Post: Sep 9, 2011 4:59pm Sep 9, 2011 4:59pm
look at the pip potentail on this weekly USD/CHF weekly chart I think the Swiss may have bitten off more then they can chew by pegging there currency to the EUR becuase this pair could run to the top of this trend line which would major league devaule there currency to the point were the USD would be back above parity against the CHF to the toon of around 1.1250 USD/CHF if it touches the up channal line now I just jump on trands and ride them but I don't think that's what the Swiss were thinking was going to happen when they pegged the swissy to the EUR I know they though it may depreciate the Swissy some but the Euro Zone is in major trouble so it will really effect the Swissy as well. The key question here is why did the Swiss peg there currency to the Euro are they planning on jioning the EU food for thought ?
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  • #2
  • Sep 9, 2011 5:03pm Sep 9, 2011 5:03pm
as you can see I use fractles on my charts as well as trend lines just in case the pair breaks up or down through the trendlines for a breakout trade on the weeklies
  • #3
  • Sep 9, 2011 5:06pm Sep 9, 2011 5:06pm
I also use the MACD histogram to tell me the direction the momentum of the market and if you see it the histogram is above the 0 line meaning we have nice upward momentum on the USD/CHF so guess what looks like next week will follow through yo the upside as well so expect atleast another upside week or so of USD/CHF upside becuase weekly momentum just doesn't reverse as quick as the Hourly or 15 min chart momentum does.
  • #4
  • Sep 9, 2011 5:50pm Sep 9, 2011 5:50pm
Quoting imnotapro
I don't think that's what the Swiss were thinking was going to happen when they pegged the swissy to the EUR
Think again.
  • #5
  • Sep 9, 2011 6:06pm Sep 9, 2011 6:06pm
so you think they want there currency to collapse so they can get better breaks on there exports but they don't want it to move below dollar pairity expecially when the dollar is one of the weakiest currency in the world right now .
  • #6
  • Sep 9, 2011 7:59pm Sep 9, 2011 7:59pm
They have a lot of breathing room for depreciation, and a healthy drop is different from a collapse. They have the benefit of an already-high trade surplus, so this devaluation should help not only that, but domestic spending, as well.

USDCHF parity is a thing for politicians and traders, it doesn't mean much to Mr. Schultz the clock maker and the SNB knows this.
  • #7
  • Sep 9, 2011 10:11pm Sep 9, 2011 10:11pm
Well, with the EuroSwiss pegged.... if DollarSwiss makes that dramatic of a shift, then Euro would counter that with a large decline.

Of course, EuroSwiss could continue to appreciate much farther than 1.20, but they always have to be in balance. (ie) EuroDollar times DollarSwiss equals EuroSwiss.

Right now, the USA is getting just what it probably didn't want, a much stronger dollar. Seems like a good time to fire up the printing presses.
  • #8
  • Sep 9, 2011 10:21pm Sep 9, 2011 10:21pm
I wouldn't pay much attention to USDCHF. EZ is the main trade partner of Switzerland. Retail forex is almost the same size in USDCHF and EURCHF but commercial (and hence interbank) is a lot more in EURCHF than USDCHF. So basically out of these 2 pairs EURCHF is a "major" and USDCHF is "exotic" so to speak.
  • #9
  • Sep 9, 2011 10:24pm Sep 9, 2011 10:24pm
Quoting Price

Right now, the USA is getting just what it probably didn't want, a much stronger dollar. Seems like a good time to fire up the printing presses.
Yes, I can see QE3 as a reaction to dollar appreciation. The Fed will sell it as counter-recession remedy.
  • #10
  • Sep 10, 2011 11:41am Sep 10, 2011 11:41am
The thing I was wondering is, if USA have been trying to devalue and just can't seem to make it go lower.... then why not print truckloads. Apparently everyone has to buy it.
Of course, I live here so, I'll be sorry I said it next time I go to the grocery store and see everything has doubled.... again.
  • #11
  • Sep 10, 2011 12:05pm Sep 10, 2011 12:05pm
Quoting Price
The thing I was wondering is, if USA have been trying to devalue and just can't seem to make it go lower.... then why not print truckloads. Apparently everyone has to buy it.
Of course, I live here so, I'll be sorry I said it next time I go to the grocery store and see everything has doubled.... again.
Oh! they desperately need to keep the printing presses running. The only reason US gives a breather to the printing presses is because the $ would lose it's reserve currency status, effectively signaling the end of US hegemony. US is threading a very thin line indeed.
"To hold, you must first open your hand. Let go." - Lao Tzu
  • #12
  • Sep 10, 2011 3:48pm Sep 10, 2011 3:48pm
Quoting seagreen
I wouldn't pay much attention to USDCHF. EZ is the main trade partner of Switzerland. Retail forex is almost the same size in USDCHF and EURCHF but commercial (and hence interbank) is a lot more in EURCHF than USDCHF. So basically out of these 2 pairs EURCHF is a "major" and USDCHF is "exotic" so to speak.
+1 Right on, man.

'imnotapro', if I've learned anything from following Chf crosses is that they don't follow TA. SNB>TA lol
  • #13
  • Sep 10, 2011 5:09pm Sep 10, 2011 5:09pm
Well!!! I think the SNB, would love and are maybe betting on you being right!!

As I understand it, the bank is buying up, accumulating here, and if you buy you def intend to sell somewhere, maybe at the top of that range! for big $$$ PROFIT $$$ .. if I am wrong in my understanding, please correct me!
  • #14
  • Sep 10, 2011 10:22pm Sep 10, 2011 10:22pm
http://www.snb.ch/en/mmr/speeches/id/ref_20110906_pmh
  • #15
  • Last Post: Sep 10, 2011 11:19pm Sep 10, 2011 11:19pm
Quoting imnotapro
look at the pip potentail on this weekly USD/CHF weekly chart I think the Swiss may have bitten off more then they can chew by pegging there currency to the EUR becuase this pair could run to the top of this trend line which would major league devaule there currency to the point were the USD would be back above parity against the CHF to the toon of around 1.1250 USD/CHF if it touches the up channal line now I just jump on trands and ride them but I don't think that's what the Swiss were thinking was going to happen when they pegged the swissy to...
The Swissie's haven status is a leftover from another era, the Cold War, and I suspect that the Swiss want to see that legacy dead and buried. For the time being, the Euro and Greenback crisis helps ensure that no one is tempted to use them for long term safety given the uncertainties/risk in so doing. Gold will have to do.
The road to pipland is arduous and fraught with challenge.
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