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Trichet, ECB Rate Hike and EUR/CHF
By DailyFX Updates | August 2, 2007
The ECB is suppose to be off enjoying their summer holidays, but instead of doing so, Central Bank Head Trichet held a “Special Press Conference” where he used the words “strong vigilance.” We have been watching for these codes words very carefully because over the past year, everytime he uses those words, rates are increased the following month. So expect a rate hike in September, but after that there should bea nice long pause because Trichet refused to say that rates remained accommodative, which indicates that he may be ready to pull the plug on further hikes. This is part of the reason why the EUR/USD has failed to react.
Also I’m loving EUR/CHF – going long here at 1.6500 with a stop at 1.6420, targeting 1.6600. There’s a nice reversal in the making and I’ll be trailing my stop along the way =_
Tags: dollar, forex, forex news, forex trading
Topics: What To Look At In The Market | 1 Comment »
August 3rd, 2007 at 10:20 am
[...] The foreign exchange market should not destroy the US dollar, at least in the short-term, because of the inherent value that many traders place in the stability of the US currency. But the American economy is reeling from the housing and mortgage crisis (exacerbated by the falling stock market), and the news will provide impetus for many traders to move out of dollar-denominated assets. One place to move into is Europe, because as Kathy Lien of FXCM notes, the surprise press conference for the ECB yesterday almost certainly confirms an interest rate hike in S…. [...]