Friday, March 13, 2009

Courtesy of the Swiss Government

Also In Today’s Letter…

• Is this a Dollar Top We’re Seeing?
• Finding the Sweet Spot: How to Spot a Trend in the Spot Forex Market

By Chuck Butler It’s not just a Fantastic Friday today – it’s also Friday the 13th!

In fact, it’s the second Friday the 13th in a row this year. A double dose of Friday the 13ths is supposedly even worse luck for all those involved (or it’s at least bad news for the “paraskevidekatriaphobics”…folks afraid of Friday the 13th).

But dear reader, it’s hard to notice any so-called “bad luck” today. After all, I woke up in Florida this morning. It’s a bit cloudy, but it’s a nice 66 degrees (at least compared to the 28 degrees in St. Louis this morning). And tomorrow I’m heading even further south to watch my beloved Cardinals play! It’s paradise as far I’m concerned.

Okay, onto currencies…the big news today comes from Switzerland. It seems they can’t get the Swiss franc cheap enough, fast enough…

Yesterday, the Swiss National Bank (SNB) intervened in the markets with a bang! The SNB sold francs for euros and dollars to further reduce the franc’s price. It was a last ditch effort, considering they’ve already cut interest rates to the bone. Francs went from 86-cents to 84-cents in one day! Ugh!

That marks the first solo intervention in Switzerland in 17 years. On top of that, they also slashed rates again. They’re now even closer to a ZIRP…at .25%. Obviously the worst recession in 30 years is forcing them to “get creative” to reign in their economy.

Meanwhile, currencies enjoyed a day in the sun yesterday. The euro, peso and the South African rand are all shooting higher, but I have to wonder what this means for global markets.

Is this a peak in the dollar’s rise? Could be folks, for all this week, even with the profit taking, the currencies have moved higher vs. the dollar led by the euro (except of course francs which were sold by the SNB!).

Just like at the beginning of December, when I gave you the wink and nod that we could see a Santa rally in euros, and we did. This is beginning to look a lot like Christmas…

The dollar can’t rise here, and the euro is gaining there, but do we really know for sure this is the end of the dollar’s run? NO! We don’t know for sure, but… If you were looking to get in on the ground floor, the bottom if you will, this could be it!

Of course, this could be a false down too. And that means you won’t have gotten in on the ground floor… But, at least it will be a cheaper level than in December!

That’s it for today. Since I’m on the road today, I’m turning the floor over to my colleague and fellow Forex trader, Sean Hyman sooner rather than later. In today’s special comment below, he’s giving you everything you need to know about how to ride a market trend straight to future profits – yes, even in this market environment.

By the way, I’ll be traveling all next week as I tour South Florida for Cardinals games, conference appearances and other March Madness. But fear not dear reader, I’ll still check in with you as often as I can. Until then…

Have a Fantastic Friday and Wonderful Weekend!
Chuck