“Huck loves her bucks!” I always say. The problem, of course, is how to make those bucks!! In this blog, I'll be posting my adventures as I traverse the forex world, while trying to catch some pips along the way. To do this, I will make use of classical charting methods as well as develop my own Trade Idea: 2012-9-14 1:31 am EST
I might have missed out on all the action, but I think I already know what pair I'll be trading next week: USD/CHF!
As you can see, the pair just broke support at the 200-SMA on the daily timeframe. As I said a couple of weeks ago, a lot of traders pay attention to the indicator, using it to determine trends. So could the break could indicate that the pair is about to start a new downtrend?
The technical setup also matches very well with the fundamentals. For one, there was no change in the rhetoric of the Swiss National Bank (SNB) yesterday, which means it's business as usual for them.
Second, and more importantly, the Fed just announced another round of quantitative easing. In the last two times the Fed engaged in QE, the dollar was sold-off heavily for a few months. Quantitative easing, even though aimed to stimulate the economy, can be seen as negative for the domestic currency.
This QE3 could result in an even stronger dollar sell-off, as it is open-ended. It means that the central bank doesn't really have a set limit to the money it will print. According to the Fed, they would continue to pump stimulus to the economy as long as the U.S. labor market remains weak.
That's it for today! Hopefully, a good short setup appears or the lower time frames of USD/CHF.
XOXO,
Huck
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Related Posts:
- Huck's Pre-Week Market Analysis for April 8 to 12, 2013 03:40 08 April 2013
- GBP/USD: Waiting for a Trend Line Break 02:02 16 February 2012
- Fibonacci Setup on GBP/USD 02:55 09 October 2012
- GBP/USD: Entering on a Pullback 01:26 22 November 2012
- GBP/USD: Will the Rising Trend Line Hold? 23:57 01 August 2012
