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EUR/CHF

  • #13,601
  • Jan 7, 2015 1:27pm Jan 7, 2015 1:27pm
Quoting zoran22
{quote} what do you mean strong EUR in 2012, it was on verge of collapse and defaulting of spain, portugal and italy,
??? The only country in serious trouble in 2012 was Greece. The others just sucked, as they suck now. Nothing was to collapse., these countries are very good at sucking for the long term. If you believed euro was to collapse back then, why you didn't shorted it, imagine where you would have ended in 2014 !

Now is different. ECB wants to try what has worked for the US, and has let the world know.

Sure, SCB can maintain the floor at the cost of filling their coffins with devaluating Euro debt.

Anyway, for active traders this pair is dead unless you mean parking your money at paying swaps. Sorry but not me, I took my chances, paid my price, bye now. I do not intend giving away my money to any broker, or deceitful central bank.
  • #13,602
  • Jan 7, 2015 4:30pm Jan 7, 2015 4:30pm
Quoting Paz
{quote} ??? The only country in serious trouble in 2012 was Greece. The others just sucked, as they suck now. Nothing was to collapse., these countries are very good at sucking for the long term. If you believed euro was to collapse back then, why you didn't shorted it, imagine where you would have ended in 2014 ! Now is different. ECB wants to try what has worked for the US, and has let the world know. Sure, SCB can maintain the floor at the cost of filling their coffins with devaluating Euro debt. Anyway, for active traders this pair is dead unless...
i am EUR short from 2008. because of slow ECB reaction on crisis,

EUR after QE will be stronger then ever, but for now it sucks

you can trade EURCHF futures (CME RF)- cheaper, positive swap, and most of the time no real spread
  • #13,603
  • Jan 7, 2015 6:29pm Jan 7, 2015 6:29pm
Swiss National Bank playing with fire before major news events. How can a central bank be that sure can defend a fixed level when trillions are being transacted daily in forex?
Why not maintain it over 1.2020? Lesson not learn yet by the central bank from 3 weeks ago? Same level 1.2008 Same widen of spreads Non payroll farm next
Brokers can widen the spread to 20 or more for an ask price over 1.20 during these events, who will protect buyers?
Or must pray for another rally to 1.209x? Missing the 1.2045 1.2070 1.2085 few seconds spikes that used to be years ago when eurchf was on same level.
  • #13,604
  • Jan 7, 2015 7:22pm Jan 7, 2015 7:22pm
Quoting zoran22
{quote} i am EUR short from 2008. because of slow ECB reaction on crisis, EUR after QE will be stronger then ever, but for now it sucks you can trade EURCHF futures (CME RF)- cheaper, positive swap, and most of the time no real spread
By this definition are you saying that Japan is stronger than ever considering their level of current and future QE. The Germans and the ECB have been fighting over QE for some time. The Swiss will also be against it as it would make it near on impossible to hold the peg.

The EUR/CHF is right back to where it was before the intervention through negative deposit rates which take effect on the 22nd Jan (from memory). Not sure how long this game of peg chicken can last for before the peg gets run down.
  • #13,605
  • Jan 7, 2015 9:30pm Jan 7, 2015 9:30pm
Quoting Razor_trader
{quote} By this definition are you saying that Japan is stronger than ever considering their level of current and future QE. The Germans and the ECB have been fighting over QE for some time. The Swiss will also be against it as it would make it near on impossible to hold the peg. The EUR/CHF is right back to where it was before the intervention through negative deposit rates which take effect on the 22nd Jan (from memory). Not sure how long this game of peg chicken can last for before the peg gets run down.
After QE is finished, EUR will be very prospective not before, that is the point, you can see at the moment GBP and USD which after tapering are in constant growth, JPY when finishes its QE, which is structural different than EUR QE, will prosper for sure

and after all years of this EC floor, i simple cant believe that someone even doubts famous frase 'utmost determination and buying unlimited quantities', it works perfectly, and that anybody can even imagine SNB will drop 1.2 floor and have biggest CB loss in history of central banking and major deflation with huge decrease in swiss exports,

in 80' negative rate for CHF was -10%, let me see who will buy CHF if that case happens again

i would also like that this pair trades above 1.205 at least
  • #13,606
  • Jan 7, 2015 10:10pm Jan 7, 2015 10:10pm
Quoting zoran22
{quote} After QE is finished, EUR will be very prospective not before, that is the point, you can see at the moment GBP and USD which after tapering are in constant growth, JPY when finishes its QE, which is structural different than EUR QE, will prosper for sure and after all years of this EC floor, i simple cant believe that someone even doubts famous frase 'utmost determination and buying unlimited quantities', it works perfectly, and that anybody can even imagine SNB will drop 1.2 floor and have biggest CB loss in history of central banking...
US is strong now, please show me the evidence that it is strong as a result of QE and please don't reference the Stock market which helps less than 5% of Americans, please don't reference the US Dollar which really is an artificial high that only helps those with real money. What is the interest on US debt? 500 billion per year @ .25% interest rates and that is just the Government debt, not the private sector that has been flooded with money and cheap credit to the point where their debt is out of control. Do you think most businesses can afford a lift in interest rates without defaulting? Do you think most American home owners can afford their homes if interest rates rise without defaulting? Can the US government make payments without BORROWING money to pay back the FED if interest rates rise?

US has had trade deficits for a long time. These have come down with US shale helping limited them need to import Oil but how many US oil producers are going to be around in 12 months if Oil continues to fall. What is the baseline cost to produce Oil in America and at what point do they start importing it again for their needs.

And as for deflation - Is it bad.... Sure for a reckless government it is bad because it makes it harder to pay down the debt, the steal from the working class, but for consumers it is good, it allows for you to buy with you money that little bit more. Inflation is the enemy and with zero % interest rates means that the safety of banks will cost you as your deposits at near zero get chewed up by the 2-3% inflation that your GOVERNMENT NEEDS in place.

I find the whole propaganda spilling through the channels or Bloomberg and Reuters a whole lot amusing. I am an Australia with a number of American friends who come over here to play Baseball during our summer and I can tell you know, what they tell me is completed different to what the Wall Street Journal tells me. Who should I believe more - The Americans who are struggling or the Wall Street Journal designed for those who have become richer thanks to the US government and Fed fiscal policy.
  • #13,607
  • Jan 8, 2015 4:04am Jan 8, 2015 4:04am
Quoting Razor_trader
{quote} US is strong now, please show me the evidence that it is strong as a result of QE and please don't reference the Stock market which helps less than 5% of Americans, please don't reference the US Dollar which really is an artificial high that only helps those with real money. What is the interest on US debt? 500 billion per year @ .25% interest rates and that is just the Government debt, not the private sector that has been flooded with money and cheap credit to the point where their debt is out of control. Do you think most businesses can...
i am not discussing fundamental problem of US economy (productivity, trade balance, GDP, sales, salaries and etc..), main thing here is value of USD and value of other currencies, this is what we trade not fundaments (altough also possible through some futures contracts)

home made deflation is good in short term if you have permanent or goverment job and profit is not objective of business, other wise it means recession for most of economy

i also dont support this financial establishment as it is not good for world, but this how things are
  • #13,608
  • Jan 8, 2015 9:33am Jan 8, 2015 9:33am
it seems that negative rates doesn't work, SNB has huge problem with buying tons of Euro, and depreciation of Euro will be making very difficult to defend the peg level.
  • #13,609
  • Jan 8, 2015 11:24am Jan 8, 2015 11:24am
Quoting tomas.v
it seems that negative rates doesn't work, SNB has huge problem with buying tons of Euro, and depreciation of Euro will be making very difficult to defend the peg level.
Anyone believed jordan words of negative rates did its work to lift eurchf, burning some francs?

The 33B intervention did the job. Nobody cared about negative rates, not even -10% will help, sellers will bring it back to this price after few weeks.

As long as they keep defending 1.2008 or so, as long as pressure will become unlimited and utmost on the 1.20, although doubting a dramatic break, possible hunting sl's by brokers!
  • #13,610
  • Jan 8, 2015 11:42am Jan 8, 2015 11:42am
Quoting Mevo
{quote} Honestly, my opinion is that it's only in your dreams. If it can reassure you, you're not the only one to dream. The SNB doesn't "need" anything or to do anything. YOU would like them to do something because you probably are long EUR/CHF. Don't confuse both. Let's be honest one second: raising the floor would put MORE pressure on it, not the opposite. To lower the pressure on the floor, they would need to LOWER it, not the opposite. Now, they can just let things like they are. They want E/C to not drop under 1.20 and things are going pretty...
Buyers have more realistic opinion of 1.30 than yours of 1.10! Both opinions unrealistic for the time being.

Why would Swiss NB lower the floor or leave its currency strengthen that much versus the euro when buying unlimited billions of foreign currencies, they'll start buying dollars instead of euros if they had not already done.

They can raise the floor to 1.25 or 1.30, like they are defending 1.20 they are able to defend 1.30(example). Sellers will not have any upper hand neither on 1.20 nor 1.30 if Swiss NB decides its the floor. It's all a matter of psychology trading, some initial pressure may happen to 1.30 or whatever new floor(if applicable), by time sellers who got stopped out may become the buyers, and buyers who exited taking profit on 1.22 1.24 1.27 may start building positions on 1.30, sellers who want to revenge will continue sellers of 1.3008 instead of 1.2008.

Obviously, they see franc very overvalued vs euro on 1.20, no lower price possible, higher price very possible, what price and when, Swiss NB has the answer.

It's all about what the Swiss NB wants of value for its currency vs the euro.
  • #13,611
  • Jan 8, 2015 12:17pm Jan 8, 2015 12:17pm
Quoting tomas.v
it seems that negative rates doesn't work,
-0.25% maybe not, but -0.75%?
  • #13,612
  • Jan 8, 2015 1:46pm Jan 8, 2015 1:46pm
file:///C:/Users/01/Downloads/Negative%20interest.pdf
google it here...
(Reflections on negative interest rate in
Switzerland )

http://snbchf.com/chf/chf-history/long-term-view/

In early 70's when the negative interest was introduced, it did not inflict weakening of CHF. (chart in the second link)
  • #13,613
  • Jan 8, 2015 3:31pm Jan 8, 2015 3:31pm
Good article. That's my point.
  • #13,614
  • Jan 8, 2015 3:48pm Jan 8, 2015 3:48pm
Minus 0.25% or minus 25% doesn't make a difference. In either case you don't leave cash with the bank.
Sure SNB can try again the cheap means but the marked will laugh it off in 3 hours as it happened before.
  • #13,615
  • Jan 8, 2015 9:39pm Jan 8, 2015 9:39pm
Quoting zoran22
{quote} i am not discussing fundamental problem of US economy (productivity, trade balance, GDP, sales, salaries and etc..), main thing here is value of USD and value of other currencies, this is what we trade not fundaments (altough also possible through some futures contracts) home made deflation is good in short term if you have permanent or goverment job and profit is not objective of business, other wise it means recession for most of economy i also dont support this financial establishment as it is not good for world, but this how things are...
All good, love the written language as it can be hard to breakdown and interpret what has been written.

I agree, asset bubbles inflate and crash all the time so currency bubbles are no different. They are at the best of times irrational but as traders if you're in at the right time and you can get out at the right time you can make money. Knowing earlier than later when an asset is under priced and likely to go through a bubble cycle is the hard part.

The old saying that markets can remain irrational longer than you can remain solvent is very true.

Best of luck

RT
  • #13,616
  • Jan 9, 2015 3:27am Jan 9, 2015 3:27am
Which broker do you recommend to hold EUR/CHF long term?

Must be:
1) reliable
2) have positive or zero swap
3) fixed 500x leverage (or more) over the weekend!
Yeah?! Well.. you know, that's just like.. your opinion man! - Big Lebowski
  • #13,617
  • Edited 7:01am Jan 9, 2015 6:46am | Edited 7:01am
4th estimation... E/Chf shoots up in 6 hours.

This is my personal feeling. Derived from observations of the market.
  • #13,618
  • Jan 9, 2015 6:57am Jan 9, 2015 6:57am
Quoting Fana
4th estimation... E/Chf shoots up in 6 hours.
Your reasoning?
  • #13,619
  • Jan 9, 2015 7:13am Jan 9, 2015 7:13am
Not before bombing all buyers accounts, remember 1.1990 on CPI by scammers like FXCM!

Otherwise, it has the potential to fly up at anytime, when? who know!
  • #13,620
  • Jan 9, 2015 2:56pm Jan 9, 2015 2:56pm
Quoting Harris27
Not before bombing all buyers accounts, remember 1.1990 on CPI by scammers like FXCM!
That can only happen when one places stop orders. It is not mandatory to place stop orders.
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