FOREX ANALYSIS : CADCHFFX:CADCHF [/symbol
If you want to use this idea, please risk only one percent of your account balance.
Longchf
CHFJPYNot a clear buy yet, but if the preice stays above, long term tp for buy is the red line.
Good luck!
Gbp/Chf short if it breaks the trendlineExpecting a flat correction on this pair with the C wave starting soon. We are in a longer term uptrend though, so i will be looking for buys if the price gets to the 1.23-1.235x area.
Swiss franc looks strong to me for the next couple days so ill be looking to buy CHF in other pairs like Eur/Chf or Chf/Jpy.
GBPCHF potential bearish bat pattern on 4H chartsell @ 1.25541
nice daily resistance around X-level as protection
USDCHF potential bearish cypher pattern on 4H chartsell @0.99010
strong weekly resistance at 0.99 (red line) providing upside protection.
EURCHF SHORT advanced pattern galore on 4H chartPick your entry and sell at D completions of these advanced patterns respectively! I will enter them all but with reduced risk for the two cypher patterns (turquiose and green ones) and use normal risk for the bat (violet).
GBP DOWNSIDE BREXIT POSITIONING & VOLATILITY UPDATEMy FX portfolio currently consists of :
- 2Long x USDJPY @ 106.8; 2Short x GBPJPY @ 151.2 (dynamic hedge for long UJ); 2Short x GBPUSD @ 1.4570. I will add to my short GBPUSD holdings if i can get a similar price & I may add to short GBPCHF or EURCHF downside if markets make a turn for the worst as IMO CHF denominations are under-priced relatively (as discussed in the attached article).
ATM Implied Volatility and Historical Volatility:
- GBPUSD ATM IV continues to rally today, despite being in the 2 year 100th percentile, to trade at 19.15% (0.6 up) currently, 1wks 20.5% (up 1.5), 1m 29% (up 0.5) from yesterday, whilst HV continues to trade relatively flat at 10%, with ATR increasing about 10 pips on the week.
- This positive divergence in IV and HV means that GU potentiallly has almost 2x as much more volatility to show in its price action - so I expect the market to get much more rangy in the coming weeks, so anyone day trading i advise to leave GBP crosses alone and i advise a MINIMUM SL of 1 ATR which is 150 pips, as IV implies such moves will become less and less uncommon in the coming weeks.
Therefore I also suggest only play longer term 2/3wk positions so that the 150pip SL can be justified with 300+pips of upside tp.
- GU Risk Reversals on the 1wk increased to -2 (from -1.8) with the 1m trading flat at -8.7, so we can expect further downside in the pair as puts in the nearterm continue to be demanded more so than the calls - which makes sense in this highly volatile and fundamentally short environment.
Vol demand
- GBPJPY and GBPCHF1wk and 1m risk reversals in the long run are becoming negative at a higher rate/ momentum compare to USD e.g. investors are buying GBPJPY and GBPCHF Puts at an increasingly faster rate than GBPUSD puts (the change of the RR values are increasingly negative more than the GU - The GU RRs are almost already fully priced). Hence, from a future value point of view (since the demand for downside is not outpacing that of GU) we can expect, GCHF and GJPY to in the future fall at a faster rate than GU, which makes sense given the room let until the next support levels.
- GJ 1wk and 1m are at -0.9 and -7.4, whilst GCHF are at -1.2 and -5.6 (compared to GU at the above -2 and -8.7), we can see that the put demand for GJ and GCHF still has room to increase until it reaches the levels that GU is trading at hence why I like expressing GJ and GCHF even more so.
- Finally, GJ and GCHF HV trade at 19 and 15 respectively. However GJ vols are begging to trade lower, (perhaps indicating the pair is now becoming oversold) and GBPCHF HV is trending higher (indicating that sell side demand may be picking up now that the GJ expression is reaching its fully priced state, after selling off since sunday).
This supports my view from my last piece about getting short GBPCHF now vs adding shorts to GU or GJ since they are much more overweight to the downside.
