Since the bank of Switzerland intervention blast year I haven’t placed a trade on the EURCHF. And I really missed it, it was a good cross, it had nice swings, and most of the time they were smooth.
Do you think it will good for trading some day? Or have you even placed a trade here since the intervention?
Take a look at it now:
It is getting closer to the 1.2000 level, remember the bank of Switzerland said it will not allow the EURCHF to trade bellow 1.2000? Do you think it will intervene again? I think so… So for now, I’m just going to forget about the EURCHF and focus on other crosses.
Both, the BOJ and the SNB have expressed their concern on the on-sided movements of their currencies (JPY and CHF respectively). Both of them are strong and these are the main reason why I think both of them are appreciating:
CHF: the CHF is being used as a reserve currency (debt crisis on some European countries, growth conditions, and others).
JPY: I have no clue, I don’t see a fundamental reason, but hey, the market is the market and if it’s appreciating it’s because the demand is increasing (from China perhaps?)
But which one do you think is stronger?
Answer: LOOK AT YOUR CHARTS… I’m kidding :)
Take a look at this chart:
Over time, looks like the CHF is stronger than the JPY, there is just small retracement after the SNB expressed their concern.
Right now I would be cautious about taking short positions on any pair related to the JPY, it is likely that the Bank of Japan (BOJ) will continue to intervene on its currency (like they have been doing):
It is known that the BOJ doesn’t feel comfortable at the current levels of the JPY against all crosses (Japan is a net exporter, they need a weak currency).
For now, I will only consider going long if I have a bullish MC on the yen crosses.