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EUR/CHF

  • #8,041
  • Jun 18, 2012 9:53pm Jun 18, 2012 9:53pm
Quoting cadencetrade
I think this trade is a really good buy and hold, might take a long time but you can always take profit when it will eventually spike a bit and re-enter when it comes off.
That's right, especially if they trade with huge positions. Otherwise it's just waiting and cashing in the positive rolls.

On the other side, I don't understand the hedge fonds that trade against the SNB and 1.20 peg. Do they really think they are stronger?
May be an illusion.
  • #8,042
  • Jun 18, 2012 10:29pm Jun 18, 2012 10:29pm
Got a nasty surprise from my broker... (Instaforex)

Previously I get EUR 0.20 swap per lot. Now it went to negative -0.3 points.
Wrote to them to ask why & they replied below.....

Dear Client,

Swap rate for eur/chf has been changed due to current conjuncture
situation on this currency pair. You can change your account to Swap
free in your Client Cabinet, Personal information section after all
current positions are closed. If you have any questions please do not
hesitate to contact us in future. Thank you for your letter.

Sincerely yours, Client Service
Attached Image
  • #8,043
  • Jun 18, 2012 10:50pm Jun 18, 2012 10:50pm
Swiss give up control of their monetary base?:

http://ftalphaville.ft.com/blog/2012...ntal-trilemma/

Not a chance, way too risky......
  • #8,044
  • Jun 19, 2012 1:19am Jun 19, 2012 1:19am
Quoting alaneth
Got a nasty surprise from my broker... (Instaforex)

Previously I get EUR 0.20 swap per lot. Now it went to negative -0.3 points.
Wrote to them to ask why & they replied below.....

Dear Client,

Swap rate for eur/chf has been changed due to current conjuncture [i]
situation on this currency pair. You can change your account to Swap
free in your Client Cabinet, Personal information section after all
current positions are closed. If you have any questions please do not
hesitate to contact us in future. Thank you for your letter.

Sincerely...
i same have this problem today.. wtf
  • #8,045
  • Jun 19, 2012 1:51am Jun 19, 2012 1:51am
I just had a look at the calender it is a fairly big data week for the chf

I dont expect it to move the pair but will give a good view of the swiss economy
  • #8,046
  • Jun 19, 2012 4:05am Jun 19, 2012 4:05am
If the SNB is doing nothing, some people will close their long positions. IMO
  • #8,047
  • Jun 19, 2012 4:10am Jun 19, 2012 4:10am
Quoting tomplank
If the SNB is doing nothing, some people will close their long positions. IMO
I would say a lot of people closed there positions after last weeks monetary meeting
  • #8,048
  • Jun 19, 2012 6:10am Jun 19, 2012 6:10am
still less some gun powder if more bad export data and bad cpi or even the bad kof, i guess the snb will come out some aggressive idea in next meetings or maybe sudden announced
  • #8,049
  • Jun 19, 2012 6:44am Jun 19, 2012 6:44am
Quoting tim10167
I do believe as you said SNB should worry about the Swiss inflation "long term", but exactly as you said it is "long term",so SNB still has plenty of time to deal with that future problem. But in the "short term" letting EURCHF fall below $1 (dont expect $1.1 will hold) will cause a certain degree of "deindustrialization" in the country and rise in unemployment at a very rapid rate maybe within just 6~12 months time. So, if both printing too much CHF and deindustrialization are both very painfull for Switzerland, what alternatives and choices...
A problem of 100.000.000.000 CHF is manegeable, a problem of 700.000.000.000 not . SNB won't buy euros at more 1,2000, and won't buy at 1,2000 forever. Be cautious. HF will intensify attack for sure because they know someday SNB will give up. Do you believe you are smarter than Hedge Funds and the market?
  • #8,050
  • Jun 19, 2012 6:49am Jun 19, 2012 6:49am
Quoting qatar
A problem of 100.000.000.000 CHF is manegeable, a problem of 700.000.000.000 not . SNB won't buy euros at more 1,2000, and won't buy at 1,2000 forever. Be cautious. HF will intensify attack for sure because they know someday SNB will give up. Do you believe you are smarter than Hedge Funds and the market?
SNB did spend about 300.000.000.000 CHF until now.
Do you realy think they give up their 1,20 floor? I don't think so.
If so, they also could burn the whole money.

I am waiting til HF begin to cover their short positions.
  • #8,051
  • Jun 19, 2012 7:16am Jun 19, 2012 7:16am
Quoting tomplank
SNB did spend about 300.000.000.000 CHF until now.
Do you realy think they give up their 1,20 floor? I don't think so.
If so, they also could burn the whole money.

I am waiting til HF begin to cover their short positions.

If HF covered their positions SNB would sell euros to them. But won't happen. SNB is happy with 1,20 and in every spike SNB may be the largest seller of euros. So EURCHF won't go up. And SNB won't buy euros forever. In fact now is not buying and holding euros, but dollars, pounds, etc. This will result in a new currency basket-linked peg: there will be a mega chaos when announced
  • #8,052
  • Jun 19, 2012 7:25am Jun 19, 2012 7:25am
Quoting qatar
If HF covered their positions SNB would sell euros to them. But won't happen. SNB is happy with 1,20 and in every spike SNB may be the largest seller of euros. So EURCHF won't go up. And SNB won't buy euros forever. In fact now is not buying and holding euros, but dollars, pounds, etc. This will result in a new currency basket-linked peg: there will be a mega chaos when announced
SNB wont be happy with 1.20 if there economy starts slowing again
  • #8,053
  • Jun 19, 2012 7:34am Jun 19, 2012 7:34am
Quoting brinks
SNB wont be happy with 1.20 if there economy starts slowing again

If situation further deteriorates CHF will depreciate against $,£, yen, together with euro. Real state is still booming and swiss economy could see growth weakened, but will avoid recession for sure
  • #8,054
  • Jun 19, 2012 7:35am Jun 19, 2012 7:35am
Quoting qatar
A problem of 100.000.000.000 CHF is manegeable, a problem of 700.000.000.000 not . SNB won't buy euros at more 1,2000, and won't buy at 1,2000 forever. Be cautious. HF will intensify attack for sure because they know someday SNB will give up. Do you believe you are smarter than Hedge Funds and the market?
I know the world's largest currency hedge funds FX concepts and Goldman's Alpha fund and many others lost a lot of money last year due to SNB's intervention. Did you know how many hedge funds was forced to shut down because of poor performance this year?
  • #8,055
  • Jun 19, 2012 7:38am Jun 19, 2012 7:38am
http://www.forexfactory.com/calendar.php#details=39317

I expect much lower value than forecast is.

And as you can see, on May 24th the Actual < Forecast and we saw a nice spike!
  • #8,056
  • Jun 19, 2012 7:41am Jun 19, 2012 7:41am
Quoting qatar
If HF covered their positions SNB would sell euros to them. But won't happen. SNB is happy with 1,20 and in every spike SNB may be the largest seller of euros. So EURCHF won't go up. And SNB won't buy euros forever. In fact now is not buying and holding euros, but dollars, pounds, etc. This will result in a new currency basket-linked peg: there will be a mega chaos when announced
But you are missing the point, regardless of what currency SNB hold,whether it is EURO or not, or even stocks, other country's bond, the main problem is SNB is printing too much CHF at an unsustainable speed.

I agree with u that SNB is the main seller of EURO now.
  • #8,057
  • Jun 19, 2012 7:43am Jun 19, 2012 7:43am
Quoting tomplank
http://www.forexfactory.com/calendar.php#details=39317

I expect much lower value than forecast is.

And as you can see, on May 24th the Actual < Forecast and we saw a nice spike!
I thought the spike up on the 24th was because of the negative interest rates discussion
  • #8,058
  • Jun 19, 2012 7:53am Jun 19, 2012 7:53am
Quoting qatar
A problem of 100.000.000.000 CHF is manegeable, a problem of 700.000.000.000 not . SNB won't buy euros at more 1,2000, and won't buy at 1,2000 forever. Be cautious. HF will intensify attack for sure because they know someday SNB will give up. Do you believe you are smarter than Hedge Funds and the market?
I agree with you a problem of 700.000.000.000 not manegeable

Because If SNB wishes to keep that floor SNB can kiss goodbye to any control of swiss' monetary base. Fundamentally. As stated in this paper:

http://ftalphaville.ft.com/blog/2012...ntal-trilemma/

And it is way too risky for a country unable to control its monetary base. And as stated before EUR/CHF below $1 = certain degree of deindustrialization.
Therefor we conclude some sort of capital control
  • #8,059
  • Jun 19, 2012 7:58am Jun 19, 2012 7:58am
Quoting tomplank
http://www.forexfactory.com/calendar.php#details=39317

I expect much lower value than forecast is.

And as you can see, on May 24th the Actual < Forecast and we saw a nice spike!
Agree, I think this could be game changer, can be a proof that the internal monetary boom flows into cheap import(also because severe contraction over the borders in the EU) and deteriorated trade balance data would show that the situation is unsustainable if the fx rate does not change or serious deflation. Or cr*p competitiveness in short.

Very interesting, if its like that snb can spend all reserves on negative trade b. In a couple of years...thats why no state fund from fx reserves
  • #8,060
  • Jun 19, 2012 8:08am Jun 19, 2012 8:08am
Quoting pipxster
Agree, I think this could be game changer, can be a proof that the internal monetary boom flows into cheap import(also because severe contraction over the borders in the EU) and deteriorated trade balance data would show that the situation is unsustainable if the fx rate does not change or serious deflation. Or cr*p competitiveness in short.

Very interesting, if its like that snb can spend all reserves on negative trade b. In a couple of years...thats why no state fund from fx reserves
If SNB holds at $1.20, the trade balance should still be positive longer term, but if below $1 = Partial deindustrialization, we colud see the trade balance turn negative.
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