Ingot54 wrote:I was casting around to see what the rest of the currency pairs are doing, and remembered Bob saying he doesn't trade CHF pairs because of SNB intervention policy. Strongly agree with this. And a heads-up on what is going on there:

The bellwether pair that triggers anxiety in the SNB is the EURCHF.

Last week the EURCHF touched its 240ma line, then on Tuesday it dropped through. It had closed above its 240 every day since November 30th 2012, and now that bull run is officially done.

The point of this post is that price on EURCHF is now only 155 pips above the SNB's line-in-the-sand intervention trigger. Be aware that intervention will affect all CHF pairs to some degree.

It could well be that the SNB will act to defend the franc before their stated 1.2000 level, to prevent the market getting too cheeky again. The ADR is around 33 pips currently, but on 14th January the range was 153 pips. That day the ADR meant NOTHING.

There are better/safer trades around at present, rather than playing with the traders in hell's kitchen (unless you can stand the heat)

nanningbob wrote:To help you understand the fundamentals of what I have been talking about this article will explain what the plans are and why these moves should be long term. I quote part of the article below but if you want to read the whole thing here is the link. It is a monthly plan to do this over the next months/years?

http://forexblog.oanda.com/20130404/boj ... en-impact/

New Bank of Japan (BoJ) Governor Haruhiko Kuroda held nothing back, much to the global currency market’s surprise, by kicking off his inaugural two-year term with an aggressive new easing program designed to combat more than 15 years of deflation in the world’s third-largest economy.

The key measures of the BoJ’s “Quantitative and Qualitative Monetary Easing” program include a doubling of bond purchases to 7-trillion yen (US$75b) a month and an expansion of purchases of other assets, including exchange traded funds and real-estate investment trusts. The central bank will end up buying more that +70% of newly issued debt – thereby removing a lot of supply from the market.

The pledge of aggressive buying has caused Japanese Government Bonds (JGB) to rally violently and flatten their yield curve. Surprisingly, the BoJ will buy JGBs up to a maturity of 40 years. The market had only been expecting the central bank to extend out to either the five- or 10-year bucket. Yields on 10-year JGBs have since hit a new record low of +0.425%. Low Japanese yields should push domestic investment funds to seek better returns farther afield with U.S. Treasuries the most likely destination.

The market is now worried that tomorrow’s nonfarm payroll report release will come in much weaker than expected (+200K) following the disappointing ADP National Employment Report and today’s weekly jobless claims release. A poor U.S. jobs report will certainly knock the BoJ dollar-yen fueled rally violently and quickly.