Currency forecast, June 26th

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Currency forecast, June 26th
Currency forecast, June 26th

A lot happened in the last 24 hours. Let’s start with the most important thing – the Chinese Central Bank. As it looked like there could be a liquidity problem at some Chinese banks, the Chinese Central Bank provided liquidity to selected banks. That took out some fear which was in the market (for example the Shanghai Composite was down more than 5% before that action from the central bank happened and could end the day with a loss of only 0,19%).
I think we still need to watch exactly what happens next in the Chinese market, as this looks like as it is not over at all.

Greece: Greece has a new government – that’s the good part of the story. The bad part is that the government has only 153 out of 300 seats, so if only 2 people out of the 153 would vote against them, they would not have a majority, which seems to me to be very dangerous. We need to watch that story too over the next weeks, as new elections would hurt the EURO a lot.

Hungary: The Hungarian Central Bank lowered the interest rate by 0,25%. It was expected and some traders even thought that it could be 0,5%. That was the reason why EURHUF traded lower and is currently around 297,00 (it traded around 300,00 before).

What is best to trade now? As the market is currently very sensitive on any news, it is difficult to say what will happen next, but I would prefer 3 currency pairs for now plus 1 to wait for the entry level:

EURHUF – still like the short position and wait for a move towards the 290,00 level. Every day waiting and closer to the level brings money, because of the higher interest rate.

USDCAD – As US-economy data are pretty good and most times better than expected, should help the CAD to strengthen and a move towards the 1,0300 level soon is very likely.

EURCHF – I like to get long EURCHF here around 1,2270 with a potential move towards 1,2400. The possible loss is very limited, as the Swiss National Bank (SNB) wouldn’t allow the EURCHF to trade below 1,2000.

USDJPY – We are in the middle of the range, so I like to wait for a better entry level. I would like to sell the currency pair around 99,00 but would also buy it, should we see a level of 95,00 or lower.

Good luck.

Current trades, positions and levels:

For info how the model works: The P/L is always calculated with the size of 1. So if the position is 1 and it makes a profit of 100 pips, the P/L would be +100 pips. If the position is 2 and it makes a profit of 100 pips, the P/L would be +200 pips of course – it is always calculated with the position size of 1. The position could go up to 3, in case the system has a strong view

EURUSD
(Entry lvl):
Current position: flat
Target:
Stop lvl:
Last trade: Sold 1 @ 1,3090
P/L (ytd): -110 pips

USDJPY
(Entry lvl): Sell 1 @ 99,00
Current position: flat
Target:
Stop lvl:
Last trade:
P/L (ytd): +780 pips

EURJPY
(Entry lvl):
Current position: flat
Target:
Stop lvl:
Last trade:
P/L (ytd): +230 pips

USDCHF
(Entry lvl):
Current position: flat
Target:
Stop lvl:
Last trade:
P/L (ytd): -240 pips

EURCHF
(Entry lvl):
Current position: long 2 @ 1,2270
Target:
Stop lvl: 1,2090
Last trade: bought 2 @ 1,2270
P/L (ytd):

EURHUF
(Entry lvl):
Current position: Short 2 @ 299,90
Target: 289,00
Stop lvl: 305,50
Last trade: Sold 2 @ 297,00
P/L (ytd): +580 pips

USDCAD
(Entry lvl):
Current position: Short 1 @ 1,0475
Target:
Stop lvl: 1,0610
Last trade: Sold 1 @ 1,0475
P/L (ytd):