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Inside the Currency Market: Mechanics, Valuation, and Strategies
book

Inside the Currency Market: Mechanics, Valuation, and Strategies

by Brian Twomey
November 2011
Beginner
335 pages
9h 33m
English
Bloomberg Press
Content preview from Inside the Currency Market: Mechanics, Valuation, and Strategies

Trade Strategy

U.S. dollar/Swiss franc and Swiss franc/U.S. dollar can be tricky trades. The SBI Domestic Bond Index provides the most important indicator in terms of direction for both pairs. Typically, when the SBI and SMI are up Swiss franc/U.S. dollar is up and U.S. dollar/Swiss franc is down, a long and a short. The SMI is an ancillary indicator in this equation, and doesn't necessarily correlate directly with the SBI. Yet both are by far the most widely traded instruments on any given Swiss trading day. The tricky aspect occurs when the SMI is up, say, 10 points and the SBI can actually trade in negative territory. This can send U.S. dollar/Swiss franc and Swiss franc/U.S. dollar in quite different directions. For this reason, the SBI is ...

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Publisher Resources

ISBN: 9781118149331Purchase book