CHF/JPY sell
This morning's European session kicks off with another dose of risk off tone from the overnight Asain session. Eamonn had a run down of it here in his session wrap.
There has been two main kickers for this risk off tone. Firstly, Trump's considering a new US auto's tariff proposal. See all the posts here in one place concerning this as it developed overnight. Secondly, North Korea has been on the wires threatening to call off the summit with the US. If you are finding North Korea a little difficult to work out at the moment I found an in depth article on the BBC which provided some more background information about North Korea. One day, NK is for World peace, the next they threaten to call off meetings.Overnight the Nikkei has lost another full percentage point in a second consecutive day of losses. The JPY has been the strongest currency overnight as risk off tones have encouraged yen buying. Justin reported on that just a few moments ago.
So, this morning it makes sense to keep trading with that risk off tone. I like the CHF/JPY for a sell. On the four hourly chart ,price has just broken through the 200 and 100 MA. I have entered a short with my stop the other side of the 200 MA to define and limit my risk. Greg would be pleased ;-). It is now trading at a discount too.
Risks to the trade? Return to risk on sentiment and in particular Trump is on Fox News this morning at 1000 GMT. Eamonn pointed out, rightly, that this is particularly worth paying attention to as you never know exactly what he is going to say. Oh, and Trump is not allowed to block you from his twitter feed either, so breathe easy folks.
