Recent History of the Swiss franc, August 2009

The Swiss KOF leading indicator for August has come in at -0.04 from a revised -0.85 in July, much stronger than the median forecast of -0.60.  The indicator’s m/m rise in August is the strongest increase on record.

EUR/CHF is trading lower, presently down at 1.5175.

Remember talk of BIS on bid down at 1.5150 other day.

EUR/CHF is steady at higher levels, presently at 1.5190, effectively unchanged on the day.

Talk of BIS sitting on the bid yesterday down at 1.5150/55 has lent the cross some decent support.

There was also talk of SNB or BIS (can’t remember which) with buy interest down around 1.0570-ish in USD/CHF yesterday (thanks for heads up saferanger!!)

Obviously 1.5200 now looms large as the next upside barrier.  To be honest I really can’t get too excited about this fledgling rally, when I have the biggest bank in Switzerland and one of the major trading insitutions telling me their 1month and 3month target for the cross is 1.5200. They might be wrong, we’ll see.

As an additional note their 3-month target for EUR/USD is 1.3000. Those with long positions in USD/CHF will be hoping the forecasts are both spot on the money.

EUR/CHF at 1.5170 is seeing pretty steady trade.

Couple of SNB oficials talking this morning.

Up first at 08:15 GMT is SNB’s Hildebrand. He is to speak on the financial market crisis in Zermatt in Switzerland. Apparently his speach isn’t open to the press though.

Then comes SNB’s Jordan at 09:30 GMT.  He speaks on innovation in the financial markets in Zurich.

Important support remains down at 1.5110.

Swiss ZEW investor sentiment has come in at +18.6 in August, a nice robust bounce from flat in July.

EUR/CHF is trading a little easier, down at 1.5167/72.

Swiss July trade surplus has come in at 2,347 mln swiss francs, appreciably better than the median forecast of 1,800 mln.

Exports from Switzerland fell by a real 15.1% in July to 16.27 bln.

EUR/CHF is trading marginally firmer this morning, presently up at 1.5187/92.  The market still seems happy to pick up the cross on dips to the 1.5150 area in anticipation of renewed SNB intervention.

Incase they are disappointed, sell stops are said to be gathering just south of 1.5100.

Following on from the story below I have rung a few interbank dealing desks and there are in fact some stop-losses in EUR/CHF below 1.5100 and particularly heavy below 1.5000. The SNB don’t usually signal where they are going to be buying but if their bids don’t show up then it might get nasty. On the other hand, this pair never really moves anywhere so expecting something to happen is probably a bit optimistic.

Thanks DC for the link to this Bloomberg story. The Swiss government is selling out of its stake in UBS and will likely find institutional investors to take the entire stake.

This might actually be good for the CHF if the market sees the whole US Govt/UBS saga now being put to rest. Many people have shorted the CHF as this story has unfolded. As we know, the SNB/BIS double-team have been trying to hold up EUR/CHF and I suspect that the market is quite long in expectation of them remaining in the market. If stops start running and the SNB doesn’t appear, then we may get a short-term rout.

Central banks are everywhere this morning. Traders say the central bankers central bank bought the dip to 1.6375 in Cable, while we also hear the SNB is sniffing around in EUR/CHF…

EUR/CHF has traded lower this morning against the backdrop of heightened risk aversion, presently at 1.5180 from an early 1.5205.

This 1.5180 is an interesting level, given this is where Jamie yesterday reported talk  of SNB having a bid being worked through the BIS.

Talk of buy orders now lined up at 1.5170 through 1.5150.

Traders say the Swiss National Bank has a bid in the 1.5180 area area being worked through their compadres at the BIS (Bank for International Settlements). I guess the SNB ain’t running a night desk these days…

EUR/CHF has ticked up qbove 1.52 from lows of 1.5176.