FX Board for March 27, 2014: No more Swiss squeeze
• EURCHF reversed back through the 1.2200/25 zone that it tried to break yesterday, but how much downside remains when we’re less than two figures from the peg?
• EURUSD simply refuses to follow through after testing the waters below 1.3750. Same goes for USDCHF.
• GBPUSD has pushed through the local 1.6550/1.6600 zone and the final resistance area is in view at 1.6675/1.6700 ahead of the 1.6820+ top.
• NOK sharply higher on a Norges Bank meeting that moved short-term interest rates all of one basis point. This is a big move and likely to set up a test of structural support immediately ahead and the 200-day moving average (see charts below).
• EURSEK not getting traction yet on its attempts through 8.90. It’s tough to be bearish SEK at a time when virtually all of the smaller currencies are pulling stronger against the majors — EM currencies as well.
• NZDUSD just poked above the 12-month highs and is within a couple of percent of its highs since the early 1980s, which came during the summer of 2011. NZD grabbed the baton back from AUD.
• The USDCAD bulls were forced to capitulate after the last shreds of support failed to hold. The bottom of the recent range.
The rally proved nothing more than a squeeze thus far, suggesting we should look to recent lows for the next support levels and possibly then some if risk appetite weakens further (and if JPY crosses are weaker as well). One wonders what the potential lower is as 1.2000 lies not far beyond.
Strong UK Retail Sales today pushed GBP stronger across the board and we’ll soon be within shouting distance of the lows at this rate.
The local resistance was fully taken out although we’re still in the shadows of the move down from the 1.6800+ top, with the last Fibo area of interest between 1.6675 and 1.6700.
NOK a big mover today as seen in EURNOK, and the pair could be set for a test of the 200-day moving average coming in at around 8.16 at present. This was also a flat-line area of interest last autumn.
This pair has followed through smartly and is pushing up above the 200-day moving average. Near-term consolidation aside after hitting 1.0800 area resistance today, this could be heading for the 1.10 area.
See today’s FX Board PDF.