By FX Empire.com
Economic Events: (GMT)
Major Economic Events of the Week
|
Feb. 14 |
10:00 |
EUR |
German ZEW Economic Sentiment |
|
13:30 |
USD |
Core Retail Sales (MoM) |
|
|
13:30 |
USD |
Retail Sales (MoM) |
|
|
Feb. 15 |
07:00 |
EUR |
German GDP (QoQ) |
|
09:30 |
GBP |
Claimant Count Change |
|
|
10:30 |
GBP |
BoE Inflation Report |
|
|
10:30 |
GBP |
BoE Gov King Speaks |
|
|
19:00 |
USD |
FOMC Meeting Minutes |
|
|
Feb. 16 |
13:30 |
USD |
Initial Jobless Claims |
|
Feb. 17 |
09:00 |
EUR |
German Ifo Business Climate Index |
|
09:30 |
GBP |
Retail Sales (MoM) |
Historical
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 Weekly Fundamental Analysis February 13-17, 2012, Forecast
Rules:
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.
Characteristics
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.
Analysis and Recommendations:
USD/CHF ended the week at .9165. There was little in the way of economic news effecting the Swissie this week, some disspointing news for the eurozone and germany, but this week was all about the USD vs. Greece.
The Greek Finance Minister was sent packing back to Greece. The original news stated that the EU was demanding final legislation of the austerity measures before they would consider the approval of the bailout and that they did not want promises. Further news seemed to indicate that the political agreements were short, even with the ECB’s added contributions and agreements to reduce their asset valued.
Most recent reports said that Germany made it clear that Greece missed its debt target and must increase its austerity measures to qualify for the second economic bailout package.
The German Finance Ministry went on to state, “The Greek offer is not sufficient and they have to go away to come back with a revised plan.”
All eyes will be on the Federal Reserve officials to determine if the current policy is viable given the strong recent jobs reports, many Fed watchers are skeptical that the current stated policy to keep interest rates low until 2014 will in fact come to pass. Speeches Tuesday by Philadelphia Fed President and Atlanta Fed President may give insight if there is any concern within the Federal Reserve about the stated policy.
The Federal Open Market Committee also releases minutes of its Jan. 26 meeting on Wednesday, and Fed Chairman Ben Bernanke will speak at the Federal Deposit Insurance Corp. conference on community banking Thursday. (Watch gold)
Retail sales figures are due Tuesday, housing starts and Philadelphia Fed index data Thursday and consumer price index figures Friday. It will be a busy week for the USD.
This coming week, investors will be watching, Greece carefully, but many observers, think that a default has already been factored in the markets and that all the banks have been secured and alternative arrangements made. The problem comes about with contagion, and the future of other countries needing bailout. Ireland has already stated that based on successful negotiations with the Greeks that they want to go back to the table and renegotiate their bailout arrangements, not looking for more funding but they want the same interest and arrangements made with the Greeks.
The USD should remain up this week and should continue off the back of the unemployment reports last week, but with the Fed Chairman speaking, you never know exactly what will happen. This week keep an eye on Greece and an ear on the Fed.
The Strength
1) Initial Jobless Claims fall to 358k, 12k less than expected and the 4 week average drops to 366k, the least since May ’08
2) Job Openings in monthly BLS data rise to match the highest since Sept ’08
3) MBA said avg 30 yr mortgage rate falls to new low of 4.05% and refi’s jump 9.4%
4) German Factory Orders in Dec rise a bit more than expected
5) China’s PPI moderates to a gain of just .7% y/o/y, the slowest rate since Nov ’09
6) Indonesia unexpectedly cuts rates to 5.75% while RBA and SK sit pat
The Weakness
1) Greece on brink, AGAIN, unemployment rate in Nov hits 20.9% from 18.2% in Oct
2) German exports in Dec, the main driver of their economy, falls 4.3% m/o/m vs an expected decline of just 1%, German IP falls 3% vs est of flat from Nov
3) Euros being redeposited with the ECB overnight remain around 500b, matching the amount borrowed under the LTRO
4) BoE votes for more QE, brings asset purchase program up to 325b pounds.
Previous Economic Reports forecast v. actual
|
Feb. 06 |
15:00 |
Ivey PMI |
64.1 |
57.8 |
63.5 |
|
|
Feb. 07 |
03:30 |
AUD |
Interest Rate Decision |
4.25% |
4.00% |
4.25% |
|
03:30 |
AUD |
RBA Rate Statement |
||||
|
15:00 |
USD |
Fed Chairman Bernanke Testifies |
||||
|
Feb. 08 |
21:45 |
NZD |
Unemployment Rate |
6.3% |
6.5% |
6.6% |
|
Feb. 09 |
01:30 |
CNY |
Chinese CPI (YoY) |
4.5% |
4.0% |
4.1% |
|
12:00 |
GBP |
Interest Rate Decision |
0.50% |
0.50% |
0.50% |
|
|
12:45 |
EUR |
Interest Rate Decision |
1.00% |
1.00% |
1.00% |
|
|
13:30 |
USD |
Initial Jobless Claims |
358K |
370K |
373K |
|
|
13:30 |
EUR |
ECB Press Conference |
||||
|
Feb. 10 |
13:30 |
CAD |
Trade Balance |
2.7B |
0.7B |
1.2B |
|
13:30 |
USD |
Trade Balance |
-48.8B |
-48.4B |
-47.1B |
Sovereign Bond Auction Schedule Feb 13-17
Feb 13 10:10 Italy BOT auction
Feb 13 10:10 Norway T-bill auction
Feb 13 10:30 Germany Eur 4.0bn Aug 2012 Bubill
Feb 13 12:00 Norway Details bond auction on Feb 20
Feb 14 09:30 Netherlands Eur 3.0bn-4.0bn Jan 2017 DSL
Feb 14 09:30 Spain 12 & 18M T-bill auction
Feb 14 10:10 Greece 3M T-bill auction
Feb 14 10:10 Italy BTP/CCTeu auction
Feb 14 10:30 Belgium Auctions 3 & 12M T-bills
Feb 15 10:10 Sweden Auctions T-bills
Feb 15 10:30 Portugal Eur 1.5-1.75bn May & Aug T-bills
Feb 16 09:30 Spain Obligacion auction
Feb 16 10.30 UK Auctions 4.5% 2034 conventional Gilt
Feb 16 10:50 France BTA/OATi auction
Feb 16 16:00 US
Announces auctions of 2Y Notes on Feb 21, 5Y Notes on Feb
22 & 7Y Notes on Feb 23
Feb 16 18:00 US Auctions 30Y TIPS
Originally posted here
