Wednesday, August 3, 2011

Forex Report

What a day in CHF trading. SNB finally said "enough is enough". SNB verbal intervention will be followed by real action immediately, so says SNB. Traders are scratching their heads and are asking what SNB will do to ease? No direct intervention has been seen so far. But in forex verbal intervention is sometimes good enough. A major easing campaign is in the works to weaken CHF by reducing the interest rate band down to 0.00-0.25%, said SNB.

If this was not enough, Japanese gov't has decided that JPY strength is unacceptable for too much longer. Intervention talk is picking up and it seems like every gov't official is on the wires hourly. Traders better tighten up the stops there as well. BOJ meets late on Thu night (our time). Let's see what they do...

All of this is screwing up the DXY basket. EUR and GBP are higher. I am not really crazy about doing much but observe. Way too many trade opportunities somewhere else to associate yourself with confusion in FX, for now.

UPDATE 9:15 pm edt
Japan just intervened. JPY is diving hard. Looks like unilateral though. Let's see how long-lasting this one is...

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