Magazine article Modern Trader

Tech Talk: Franc's Stock Rising?

Magazine article Modern Trader

Tech Talk: Franc's Stock Rising?

Article excerpt

The Swiss franc has spent the last two years in a broad trading range carefully orchestrated by commercial hedgers. Skeptics will note that commercials in currency futures can hardly be market-- movers when 90% of the currency trading takes place in the forex arena. Despite futures' position as the tail of the dog in currency trading, commercial insiders have shown formidable acumen at buying low and selling high in the futures market. They have consistently placed buy signals at the lower boundary and sell signals at the upper boundary of the trading range that has existed for more than two years.

The latest signal was a minor Commitment of Traders buy (just two points shy of the major buy signal threshold) triggered on Feb. 4. This is a significant departure from the last two buy signals (arrows on chart) that were triggered on price plunges to near 0.55. In February, market insiders were buying at a price level fully 300 points higher than at those previous two buy signals. …

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