USD/CHF Threatens Long-Term Bearish Trend on Negative SNB Rate
Talking Points:
- USD/CHF Threatens Long-Term Bearish Trend as SNB Pushes Deposit Rate Into Negative Territory.
- USD/JPY Struggles to Hold Above 119.00 Handle Ahead of BoJ Interest Rate Decision.
- USDOLLAR Monthly Range in Focus Post-FOMC; Dollar to Act as Carry Currency?
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USD/CHF
Chart - Created Using FXCM Marketscope 2.0
- USD/CHF climbs to fresh monthly high of 0.9846 & threatens the bearish trend from back in 2003 as the Swiss National Bank (SNB) pushes the deposit rate into negative territory.
- Will look for a bullish breakout in the Relative Strength Index (RSI) to favor a further advance in USD/CHF especially as the upward trending channel continues to take shape.
- DailyFX Speculative Sentiment Index (SSI) shows retail crowd remains net-long USD/CHF since October 6, with the ratio currently holding at +1.68.
USD/JPY
- Despite the bullish break, lack of momentum to hold & close above the 119.00 handle may generate range-bound prices in USD/JPY ahead of the Bank of Japan (BoJ) interest rate decision.
- May see BoJ Governor Haruhiko Kuroda highlight a dovish outlook for monetary policy as falling energy prices undermine the central bank’s scope to achieve the 2% inflation target.
- As USD/JPY carves a near-term base around 115.10 (61.8% retracement) to 115.20 (161.8% expansion), will keep a close eye on the monthly high (121.83) especially as risk appetite picks up.
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Read More:
Price & Time: Important Timing Relationship Beckons USD/JPY
US Dollar Once Again Looks like a Buy versus Euro, Major Currencies
USDOLLAR(Ticker: USDollar):
|
Index |
Last |
High |
Low |
Daily Change (%) |
Daily Range (% of ATR) |
|
DJ-FXCM Dollar Index |
11491.27 |
11515.31 |
11463.86 |
-0.05 |
76.59% |
Chart - Created Using FXCM Marketscope 2.0
- Despite the bullish reaction to the Federal Open Market Committee (FOMC) meeting, Dow Jones-FXCM U.S. Dollar may track sideways over the near-term as it holds the monthly high (11,522).
- As the FOMC shows a greater willingness to normalize monetary policy in 2015, may see market participants treat the greenback as a carry currency amid the deviation in the policy outlook.
- Looks as though the former resistance zones around 11,312 (78.6% retracement) to 11,351 (78.6% expansion) will act as suppose, with 11,539 (78.6% expansion) still standing as the topside target.
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|
Release |
GMT |
Expected |
Actual |
|
Initial Jobless Claims (DEC 13) |
13:30 |
295K |
289K |
|
Continuing Claims (DEC 6) |
13:30 |
2436K |
2373K |
|
Markit Purchasing Manager Index Composite (DEC P) |
14:45 |
-- |
53.8 |
|
Markit Purchasing Manager Index Services (DEC P) |
14:45 |
56.3 |
53.6 |
|
Philadelphia Fed Business Outlook (DEC) |
15:00 |
26.0 |
24.5 |
|
Leading Index (NOV) |
15:00 |
0.5% |
0.6% |
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--- Written by David Song, Currency Analyst
To contact David, e-mail [email protected]. Follow me on Twitter at @DavidJSong.
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