Trading currency crosses opens a whole new side of the currency markets, as different crosses possess different qualities that can suit any style of trading. Some crosses move fast and are extremely volatile with daily ranges that may exceed over 100 pips. While other crosses move relatively slow and exhibit low volatility, which is more suited for novice traders.
Another added dimension to trading crosses is the ability to collect substantial amounts of interest (i.e. GBP/JPY, NZD/JPY and other high yielding crosses) as the positive carry created by the interest rate differentials can add to a trader's bottom line P/L. Discover the world beyond the majors where traders can expand their trading horizons.
All About the Crosses: [EUR/JPY] [EUR/CHF] [GBP/CHF] [GBP/JPY] [AUD/JPY]
All About the Crosses: EUR/CHF
EUR/CHF has far surpassed USD/CHF bin terms in liquidity. EUR/CHF is probably one of the safest currencies pairs to trade because its moves are so orderly. It enjoys high volume, but trades in relatively predictable ranges since the Swiss and Euro zone economies are so closely linked.
Since EUR/CHF is primarily a range bound pair, traders can use real support and resistance (available in the Market News & Charts section) to find entry and exit points for their trades. Because the pair tends to range across all time frames, using support and resistance is an effective trading strategy for short and long term traders alike!
The pair moves independently only during times of geopolitical tension or risk, when there is an inflow of capital into the Swiss franc, a safe haven currency. Breakouts like this are temporary and generally last 1-2 months.
Another added dimension to trading crosses is the ability to collect substantial amounts of interest (i.e. GBP/JPY, NZD/JPY and other high yielding crosses) as the positive carry created by the interest rate differentials can add to a trader's bottom line P/L. Discover the world beyond the majors where traders can expand their trading horizons.
All About the Crosses: [EUR/JPY] [EUR/CHF] [GBP/CHF] [GBP/JPY] [AUD/JPY]
All About the Crosses: EUR/CHF
EUR/CHF has far surpassed USD/CHF bin terms in liquidity. EUR/CHF is probably one of the safest currencies pairs to trade because its moves are so orderly. It enjoys high volume, but trades in relatively predictable ranges since the Swiss and Euro zone economies are so closely linked.
Since EUR/CHF is primarily a range bound pair, traders can use real support and resistance (available in the Market News & Charts section) to find entry and exit points for their trades. Because the pair tends to range across all time frames, using support and resistance is an effective trading strategy for short and long term traders alike!
The pair moves independently only during times of geopolitical tension or risk, when there is an inflow of capital into the Swiss franc, a safe haven currency. Breakouts like this are temporary and generally last 1-2 months.
You can find action in EUR/CHF when USD/CHF liquidity dries up (2 PM EST until London open)Analyst Says: A solid, reliable pair, EUR/CHF is perfect for range traders and busy people who can only look in on their trades once or twice a day!
- Average daily range: 55 pips
- Low volatility and tight daily ranges with occasional breakouts
- Good for: short and medium-term range trades
HOT Buttons: What moves EUR/CHF?
Gold Since the Swiss franc is partly tied to the value of gold, movements in gold prices will be reflected in this pair.
Swiss Economic data Swiss economic data is reflected better in EUR/CHF than in USD/CHF.
Geopolitical Event Risks When there is geopolitical tension, buying in the Swiss franc increases since it is a “safe haven” currency, thus pushing the price up.
Fundamentals to Watch
Swiss KoF Leading Indicators A composite of business surveys from various sectors of the economy (industry, retail and wholesale) that is combined to form a leading indicator that aims to project GDP growth approximately 8 months into the future.
Swiss CPI Consumer Price Index. A measure of inflation in Switzerland; a significant change may have implications for interest rate policy in Switzerland.
Comments from Swiss officials Watched for any indications of change in Swiss monetary policy.
Swiss GDP Gross Domestic Product. A measure of growth and productivity in the Swiss economy.
SNB Rate Decisions Any changes in the interest rate by the Swiss National Bank has implications for the pair as a carry trade.
European GDP Gross domestic product. A measurement of output, and more importantly, growth in an economy.
European Trade Balance A measure of how much Europe is importing versus how much it exports. Too many imports mean that the currency will get weaker because more Euros are being sold to purchase foreign goods.
European CPI Consumer price index, a measure of inflation in Europe. Inflation that is too high or too low may prompt Europe's central bank to raise or lower interest rates.
ECB rate decision Refers to the European Central Bank's monetary policy. If inflation is too high, the ECB will raise interest rates to slow borrowing and spending. If economic growth is sluggish, lowering interest rates will help boost activity. High interest rates make a currency more attractive.
Gold Since the Swiss franc is partly tied to the value of gold, movements in gold prices will be reflected in this pair.
Swiss Economic data Swiss economic data is reflected better in EUR/CHF than in USD/CHF.
Geopolitical Event Risks When there is geopolitical tension, buying in the Swiss franc increases since it is a “safe haven” currency, thus pushing the price up.
Fundamentals to Watch
Swiss KoF Leading Indicators A composite of business surveys from various sectors of the economy (industry, retail and wholesale) that is combined to form a leading indicator that aims to project GDP growth approximately 8 months into the future.
Swiss CPI Consumer Price Index. A measure of inflation in Switzerland; a significant change may have implications for interest rate policy in Switzerland.
Comments from Swiss officials Watched for any indications of change in Swiss monetary policy.
Swiss GDP Gross Domestic Product. A measure of growth and productivity in the Swiss economy.
SNB Rate Decisions Any changes in the interest rate by the Swiss National Bank has implications for the pair as a carry trade.
European GDP Gross domestic product. A measurement of output, and more importantly, growth in an economy.
European Trade Balance A measure of how much Europe is importing versus how much it exports. Too many imports mean that the currency will get weaker because more Euros are being sold to purchase foreign goods.
European CPI Consumer price index, a measure of inflation in Europe. Inflation that is too high or too low may prompt Europe's central bank to raise or lower interest rates.
ECB rate decision Refers to the European Central Bank's monetary policy. If inflation is too high, the ECB will raise interest rates to slow borrowing and spending. If economic growth is sluggish, lowering interest rates will help boost activity. High interest rates make a currency more attractive.
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