European Forecasts

  The USD/CHF saw a massive relief rally on Tuesday as traders suddenly felt that all was right in the world. Of course, this will more than likely change in a few hours, as the markets are very reckless at the moment. When that does – there should be a continuation of the overall trend, which of course has been down for years. We like selling rallies, and we like the 0.83 level as a place in which to sell.

  The GBP/CHF pair skyrocketed on Tuesday as traders bought into risk. The pair has even gotten back to the previous low, a natural area to expect some kind of sell signal. At the time of this writing, we haven’t seen it yet. Because of this, we are waiting to see sell signals in this pair to short it. We would never buy it as the trend is too strong to the downside.

  The GBP/USD pair rose on Tuesday, but looked oddly weak in the later part of the session. In fact, at the time of this writing, it appears that the pair is only going to be slightly changed at the end of the day – quite a statement after rising so quickly earlier. Because of this, we are still bearish of this pair, but need to see a close below the 1.59 level on the daily chart to sell.

  EUR/USD had a very volatile day Tuesday, forming a massive doji as it was reported that the American government may be close to reaching a debt limit deal. The Euro itself has been mixed around the world on the day, and this pair probably reflects the USD news rather than anything Euro-related. We like selling, but need to see new lows at this point.

On Tuesday, the pound showed advance against the dollar as hopes that EU leaders will be able to put a plan to avoid Greek default boosted demand on higher-yielding currencies. The British economy lacked fundamentals therefore the pair followed the general sentiment in the market as the dollar showed decline against a basket of major currencies despite the rise in U.S. housing starts to 629,000 in June from 549,000 in May, according to data released on Tuesday. On Wednesday, at 08:30 GMT, attention will be toward BoE minutes release which is expected to show another split among policy makers which is expected to be the same as the previous months.  The minutes for June's rate decision pushed the sterling to the downside as it showed more consensus among BoE policy makers regard keeping lose monetary policy. In July, the same voting is expected to take place with 7-2 for interest rate and 8-1 for APF.   In the US, eyes will be on MBA...

On Tuesday trading, the dollar slipped against a basket of major currencies yet it advanced against the Swiss franc as hopes that European leaders will reach an agreement regarding the Greek second bailout damped demand on safe havens, specifically the franc which has been the most favorable safe haven recently especially due to panics resulting from euro area debt crisis as a result of the proximity of Switzerland from euro zone economies. Bond selling by Greek and Spanish governments boosted some confidence in markets before European leaders meeting this week.  On Wednesday, eyes will be on MBA mortgage applications for July 15 at 11:00 GMT while will be followed by existing home sales at 14:00 GMT. Existing home sales report is predicted to advance 2.6% from the prior 3.8% drop. The main focus this week is on housing data from the US, where housing starts rose to 629,000 in June from 549,000 in May, according to data released on Tuesday.   The dollar is expected...

The EUR/USD moved higher on Tuesday with the easing jitters in the market and the battered dollar on the back of the debt ceiling debate. Tuesday was a good day for the euro as the currency managed to unwind some losses on eased jitters and optimism that the leaders might be close to resolving the crisis and helping Greece to stem the contagion risk. The sentiment in the market was also supported by positive US housing data and unexpected in German ZEW current situation index for July, which eased fears on growth. The main support though for the sentiment was upbeat earnings that lifted stocks and eased the fears. On Wednesday, the focus will remain on the debt developments in the United States and the euro area as the summit nears in Brussels and the deadline for Congress approaches. Germany will start the data at 06:00 GMT with the June Producer Price Index which is expected flat on the month in line with May...

  The USD/CHF pair rose on Monday, after gapping lower at the open. The pair is most decidedly bearish, but this move may lead the way to a bounce of sorts in the market. Any serious trader knows that these bounces are to be sold as the market is so weak. The 0.83 area above would be a perfect spot to see bearish price action from which to sell.

  The GBP/USD pair fell on Monday as traders shed risk and rushed for safe haven assets like the USD. The pair bounced off of the 1.60 level, but appears that it will attempt to finish near it – hardly a sign of confidence in the Pound. The pair needs to close below 1.59 in order for us to sell for the long-term.

  The GBP/CHF pair continues its downward trajectory, even though the candle for Monday is going to be green at the end of the day. The opening saw a gap down and it should also be noted that the market fell towards the end of the session as well. The trend is simply too strong for GBP bulls to overcome, and as such – you should be selling rallies.