Economic Events: (GMT)
Jan. 30 13:30 USD Core PCE Price Index (MoM)
Tent EUR German CPI (MoM)
13:30 USD Personal Spending (MoM)
Jan. 31 07:45 EUR French Consumer Spending (MoM)
08:55 EUR German Unemployment Rate
08:55 EUR German Unemployment Change
10:00 EUR Unemployment Rate
13:30 USD Employment Cost Index (QoQ)
14:45 USD Chicago PMI
15:00 USD CB Consumer Confidence
Feb. 01 08:30 CHF SVME PMI
09:00 EUR Manufacturing PMI
09:30 GBP Manufacturing PMI
10:00 EUR CPI (YoY)
13:15 USD ADP Nonfarm Employment Change
15:00 USD ISM Manufacturing Index
Feb. 02 13:30 USD Nonfarm Productivity (QoQ)
13:30 USD Initial Jobless Claims
13:30 USD Unit Labor Costs (QoQ)
13:30 USD Continuing Jobless Claims
Feb. 03 09:30 GBP Services PMI
10:00 EUR Retail Sales (MoM)
13:30 USD Average Hourly Earnings (MoM)
13:30 USD Nonfarm Payrolls
13:30 USD Unemployment Rate
13:30 USD Private Nonfarm Payrolls
15:00 USD ISM Non-Manufacturing Index
Highest: 1.1664 CHF on 07 Jun 2010.
Average: 0.9699 CHF over this period.
Lowest: 0.7224 CHF on 09 Aug 2011.
USD/CHF: The pair tends to break to an all-time low, then range back to the previous low. The ranges are very distinct. A break to the upside will likely meet another previous low. Pair are reliable.
Average broker spread: 4-5 pips Daily range average: 120-135 pips Best time to trade: Euro Session (0700 GMT - 1700 GMT) Factors affecting the USD/CHF rate:
- Global stability and global recovery will send USD/CHF higher
- USD/CHF rallies on geopolitical instability
Trading the USD/CHF
Trading Experience: Moderate and Advanced currency traders Trading Style: Day trading and Swing trades
How to trade?
1) Applying Technical Analysis Analyzing Fundamental News from the CHF and US zone to make USD/CHF trading decisions.
2) Since the USD/CHF pair tends to be negatively correlated to the EUR/USD, it is always a good idea to compare both EUR/USD and USD/CHF charts in order to predict future moves, if EUR/USD breaks above an important resistance level and USD/CHF didn't break support level yet, the USD/CHF is very likely to break below support level. This also illustrates how EUR/USD tends to lead the move ahead of USD/CHF.
USD/CHF Weekly Fundamental Analysis Jan. 30- Feb. 3, 2012, Forecast
Analysis and Recommendations:
The Swiss National Bank stated that the Swiss Central bank will do its utmost to defend the euro/Swiss franc lower, at 1.20 exchange rates above the decision not to will change.
The KOF leading indicators for Switzerland plunged to a new low for the cycle and the lowest level since mid-2009, a development that is no doubt raising eyebrows at the still leaderless SNB and among Swiss government officials. This comes at the same time we are seeing notable stabilization elsewhere in the Euro Zone economies. The Swiss may be getting restless soon on the intervention front.
The USD dropped this week against all trading partners on the news from the FOMC keeping interest rates low through 2014 along with negative economic reports for unemployment and housing, even though the Durable Goods report was positive.
The KOF report for Switzerland will continue to weaken the Swissie and the USD should recover this week. Keep an eye here for a good trade.
Italian and Spanish bond yields continue lower, 10 yr in Italy below 6%, Spain's below 5%
German IFO business confidence rises to 8 month high
German consumer confidence at best since April
Euro zone manufacturing and services composite index unexpectedly moves back above 50, led by Germany
US Durable Goods orders in Dec surprise to upside but how much was pulled forward from 2012 due to 12/31 expiration of full depreciation expensing?
Jan US confidence rises to best since Feb '11
Richmond and KC manufacturing survey's both rise
Bank of Thailand cuts rates, Reserve Bank of India cuts reserve requirements
Greek Creditors announce agreement, deal to be finalized beginning of the week
Portuguese yields spike, 5 yr CDS up 150 bps on week to new high and CDS insurance skyrockets
Spanish unemployment for Q4 rises to 22.9%
Italian consumer confidence holds at lowest since at least '96 when survey began
Q4 US GDP rises 2.8%, a touch below expectations but nominal GDP gains just 3.2%, the weakest since Q3 '09. If deflator was in line with expectations, Real GDP would have been up just 1.3%. Real final sales up just .8% vs. 3.2% in Q3
Initial Jobless Claims normalize at 377k after holiday distorted 356k last week
Inflation expectations within UoM rise to 3.3%, the most since Sept and remains above the 20 yr avg of 3.0%. Expectations also rise to multi month highs in TIPS market
New Home Sales remain weak, prices fall 12.8% y/o/y
FOMC stretches out zero rates until late 2014, US$ resumes downward trend against everything. Fed destroying the price mechanism as if interest rates are artificially priced, what are assets really worth? If we don't know what assets are really worth, how can capital be efficiently allocated?
And, if ZIRP was effective, Japan's economy would have boomed over the past 10 yrs.
Fitch rating service downgrades, Belgium, Cyprus, Italy, Slovenia and Spain
This has been a busy week, for both the Euro and the USD, compounded by the World Economic Forum in Davos, giving a global platform for many government and business leaders to speak their minds.
As Greece seems to be resolved, Portugal will come to the forefront without giving the markets a minute to breath. Will we see a domino effect or not, can the EU and IMF raise enough money to ringfence these countries.
Upcoming Sovereign Bond Sales Dates
Jan 30 10:10 Italy BTP/CCTeu auction
Jan 30 10:10 Norway Nok 4.0bn 5.0% May 2015 bond
Jan 30 11:00 Belgium OLO Auction
Jan 30 12:00 Norway Details bond auction on Feb 06
Jan 31 10:30 Belgium Auctions 3 & 6M T-bills
Jan 31 15:30 UK Details gilt auction on Feb 07
Feb 01 10:10 Sweden Auctions T-bills
Feb 01 10:30 Germany Eur 5.0bn 2.0% Jan 2022 Bund
Feb 01 10:30 Portugal Eur 0.75-1.0bn 3M T-bill
Feb 01 10.30 UK Auctions 5.0% 2025 conventional Gilt
Feb 01 15:30 Sweden Details nominal bond auction on Feb 08
Feb 01 16:00 US
Announces details of 3Y Notes on Feb 07, 10Y Notes on Feb
08 & 30Y Bonds on Feb 09
Feb 02 09:50 France OAT Auction
Feb 02 10.30 UK Auctions 0.125% 2029 I/L Gil
USD/CHF Pivot Points (Time Frame: 1 Day)
Name S3 S2 S1 Pivot R1 R2 R3