Trade of the Day
BUY USDCHF 0.9940 STOP 0.9900 TARGET 1.0060(RISK 0.50%, trade valid until 5pm EST)
USD: The Dollar, supported by its reserve currency/safe havens status firmed up against its major counterparts alongside higher bond yields, the Dollar index rose 0.7% to 99.037, its largest gain in nearly three months. The dollar is expected to be supported in the short term as investors piled into the safe haven currency while awaiting trade news. President Trump stated yesterday that a trade deal with China could happen sooner than later, just one day after delivering an attack on a China at the United Nation General Assembly and about two weeks prior to the next round of negotiation. Trump also inked an agreement with Prime Minister Shinzo Abe in what appeared to be an initial stage of trade deal with China
CHF: The SNB remains uncomfortable with Franc appreciation and continues to remind the market it will need to be careful about any attempts at trying to force an appreciation in the currency. But the SNB will also need to be careful right now, as its strategy to weaken the Franc is facing headwinds from a less certain global outlook. Any signs of sustained risk liquidation, will likely invite a very large wave of demand for the Franc that will put the SNB in the more challenging position of needing to back up its talk with action, that ultimately may not prove to be as effective as it once was, given where we're at in the monetary policy cycle.
From a technical and trading perspective the USDCHF staged a key day reversal yesterday from the support cluster at .9850 (monthly pivot, weekly S1 and trendline support), I am looking for follow through today and for this move to extend to test offers towards the equality target at 1.0060 as highlighted in the chart.
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!