The USD/CHF rose, and then fell as the markets around the world were rocked on Thursday. The 0.76 level looks like it is holding the pair up at the moment, so if that area gives way – we think it falls much farther. The trend is certainly down, so a breaking of that level wouldn’t be a surprise to us. The daily close below that level gets us short. Any and all rallies will also be sold.
The USD/CAD skyrocketed during Thursday trading as oil markets sold off. The CAD is highly sensitive to oil pricing, and as such we think that the pair could rise even more as we try to reach parity. The 0.98 – 0.99 areas should be some resistance, but will more than likely give way as the economies around the world will certainly need less and less oil to function. We like buying on dips, but much lower.
The NZD/USD fell hard on Thursday as the markets ran from anything risk related. The Kiwi dollar looks very vulnerable at this point as the 0.85 level gave way without a fight. The next major support level is just below at the 0.82 level, and it could produce a bounce. The truth is – these kinds of moves don’t happen as one-off movements, and the market should continue to fall. We sell rallies at this point.
GBP/USD fell precipitously on Thursday as traders found nothing but a wall of fear out there. The markets have turned decidedly bearish, and the Dollar is a bastion of safe haven trading. The jobs report us due out today, and could push this market around. If we can break below the 1.62 level – this market goes much farther down. We think the 1.65 level is going to be massive resistance, and sells could be done there.
The EUR/USD pair fell on Thursday as the trading community ran for the hills. The ECB basically said nothing at its conference call on Thursday, and that spooked the markets. The pair has taken a decidedly bearish turn, but the 1.40 area hasn’t been broken yet. If it is – we are massive sellers. Also of note, the debt crisis in Europe has gotten worse as bonds are being forced to pay higher yields. The pair is a sell only pair now and we will continue to sell rallies at this point.
EUR/CHF fell again on Thursday as traders ran for cover in the markets. Fears of global slowdowns and recessions have sparked a massive selloff in all risk-related assets, and the EUR/CHF pair fell in unison. We still like selling this pair on rallies, and even on new lows. The trend is your friend, and it has been a great one for years. We never buy this pair, and certainly see nothing to change that anytime soon.
The AUD/USD pair fell apart on Thursday as traders ran from anything risk-related. The 1.05 area is starting to give way, and if they do – 1.02 will be in the cards almost right away. The pair is a risk-related one, as such will almost certainly fall whenever the stock markets do the same thing. If we find ourselves falling again, we are going to sell below 1.0400 or so.
The EUR/USD continued its schizophrenic behavior on Wednesday as trader bought the currency, mainly in the US session to retest the 1.4350 resistance area. The issues in the Euro zone keep us from owning this currency, and quite frankly – the only reason this pair is remaining slightly afloat is that the debt ceiling deal out of DC wasn’t very impressive. We like selling rallies in this pair, but prefer to short the Euro against many other currencies.
USD/JPY fell again on Wednesday as traders continue to take risk off in the markets. The pair is certainly oversold, but then again – it has been for a very, very long time. The Bank of Japan has been jawboning this pair again, and as such – we think they are going to get involved if this keeps up. Because of this, we are staying out of this pair, save a supportive candle to the upside. But until then – this is getting dangerous to the account if you are in this pair.
The GBP/USD pair shot straight up in Wednesday trading, and closed the day towards the top of the range. This is a very bullish sign for cable, but now it is nearing the 1.65 area – an area that has given it trouble in the past. As we stated yesterday – any longs would be short-term at best. If you took that trade, you should have stop losses at break even by now, if not taking some profit off of the table. We need to see a daily close above the 1.65 handle to get long again.
USD/CHF rose sharply after SNB rate cuts on Wednesday, but only to fall again. The candle shape shows how weak this pair really is, and that the Swiss National Bank has lost all control of its currency. At this point, it looks like nothing will stem the flow of money into Switzerland except taking the Franc off of the exchanges! We still like selling rallies.
The EUR/CHF pair rose after the Swiss National Bank cut rates in a surprise move on Wednesday, but fell shortly afterwards as the problems in Europe are simply too worrisome to keep traders away from the Franc at this point. The 1.12 level held as resistance, and the 1.10 level got targeted again. At the end of the day, the candle looks pretty ugly. Selling the rallies has been the way to go for a few years – a strategy that seems to still be in vogue.
The AUD/USD pair fell, and then bounced on Wednesday to form a hammer. This is a very bullish sign, and since it is basically at the 1.0750 area – it is at the right place as well. If we can break the highs for Wednesday, this would be a classic buy signal. If we break the lows – we will see 1.05 sooner, rather than later. The trend is up, so a buying set up is preferred.
The USD/CAD pair had a wild day on Wednesday as traders went back and forth during the session. Because of this, the pair does look a bit supported at the moment, but it is in a massive downtrend – so you could take a buying signal as only so reliable at the moment. We like staying out until we get a sell signal at the right place. These would include 0.97 and 0.98, as well as parity.
The NZD/USD pair had a fairly quiet and even day on Wednesday as the markets rocked back and forth all around the world. The Kiwi has enjoyed a different dynamic lately as the Chinese are currently buying up bonds out of New Zealand. This puts support under the currency and as such keeps it afloat even when the risk is being taken off in the markets. We like going long if we can break the highs from Wednesday.
The EUR/USD fell on Tuesday as traders are starting to de-risk their portfolios during this latest round of economic uncertainty. The European bond markets make owning European anything is a risky proposition. The pair does have the Dollar in it and because of that – it hasn’t fallen as far as the Euro has against most other currencies. We like selling rallies at this point, and until the daily candle can close above 1.45 or so.
The USD/JPY pair fell on Tuesday as traders piled into the “risk off” trade in all markets. The debt limit crisis seems to have only left more questions than answers, and the situation in the European bond markets is only getting worse. In time like this, traders buy the Yen. We expect this trend to continue, but one has to wonder when the Bank of Japan steps in?
The GBP/USD fell, and then bounced on Tuesday as traders wrestled with the ideas of the debt limit increase votes. The truth is that the pair normally acts as a risk barometer of sorts, and this action is a little bit odd. However, the charts don’t lie, and this pair looks like it could make another attempt at 1.65 based upon the 1.63 support holding. Of course, we want to see a break of the Tuesday high in order to buy – but it will only be a short-term position at best.
USD/CHF fell hard on Tuesday as the trading world looked for safe havens. The Swiss Franc seems to be the ultimate safe haven, and as such – the pair fell drastically. In fact, it is currently testing the 0.76 level at the end of the New York session, which of course is an all-time low. If you sell here, you are simply chasing the trade. We prefer to sell bounces.
The EUR/CHF pair fell 350 pips on Tuesday as the trading world is running from European bond issues and anything else risk related at this point. The pair has closely tracked gold this year in an inverse direction, and as the gold markets rose $40 – this pair was always going to fall. The pair is way oversold at this point, and should only be sold – but after a bounce that is desperately needed.