View Full Version : Euro/Swiss Franc

01-16-2002, 11:47 AM
For the more daring trader,buy 2 March Eurocurrency and sell 3 March Swiss Franc.Do it now!

01-17-2002, 07:34 PM
the euro for the intermediate term has to have lots of trouble. and possibly cant survive long term without some bigger countries like england joining. the major problem with shared currencies is that each country cant cheat and we all know that they will. and the other countries will finally refuse to support them. instead of a giant trading bloc you may see a buch of little countries fighting with each other.

01-17-2002, 08:18 PM
I don't disagree but the mainstay of the Euro is the German portion.If the Euro is weak in all likelihood the Swiss will be weak as well.In addition because the Swiss depend on tourism

they have taken action many times in the past to

weaken their currency.I did the following trade I don't know how it will hold up in the long run.Take the price of the near term

Swiss futures contract.Today March Swiss(on CME) settled

at 6003.Multiply that number by 3. total of

18009.Take the march Eurocurrency 8792 and multiply by 2=17584. 18009-17584=425. I believe whenever this number is 400 or greater you should

buy 2 Euro and sell 3 Swiss.I believe fair value is about minus 200 or 625 points from settlement.

I am just experimenting with this at the moment

and am not recommending this as a top tier trade.

01-21-2002, 04:35 AM
That is excellent insight Ray. Cheating will eventually come rampant much like OPEC and the culprits will all say "well we couldn't help it". Imagine if a Euro country had a terrorist attack like 9/11. Would the other countries punish them for busting their 3% debt requirements or tell them to change their budgets? I think not! Something will happen and they will all rant and rave about it and eventually there will be partial devals or a realignment of exchange rates. Germany is the most important part of it, but it isn't 50% or anything close to it and its part will diminish as inevitably others will join, although I am not quite convinced about the UK yet. The smartest thing the UK could do is, I know this would make a Brit gasp, is DOLLARIZE with the US and Canada (maybe Mexico in 10 years). As ridiculous as it sounds, the UK is far closer in business model and economic activity to the US and Canada than it is to European countries. Europeans have this fantasy about being these balanced economies with manufacturing and finance and blah blah blah. What they are really are wasteful examples of nationalism in the case of France, Germany, and Italy. All 3 think of themselves as self-sustained worlds upon themselves and they will never admit that propping up their manufacturing and keeping ridiculous nationalistic business ownership and real estate rules actually costs them a ton of money and efficiency. The UK has generally avoided such ideals and is just a consumer driven economy that has very similar business statistics and business cycles as you see in North America. Even though they do much of their business with the Euro, that is a lousy excuse for joining it and being party to its inevitable messes coming in the next decade.

The most telling reason why I think all of this will fall apart is that most of these countries will see themselves as "defenders" of their language and its attendant culture. The three I mentioned as well as Holland, Spain, Portugal, Greece...all of them are the homeland of their language and someday there will be a crisis of sorts and nationalism will rear its head. While the UK could be the same, they clearly realize that the heart and soul of the English world emanates from the other side of the Atlantic so such crisis would never come to the forefront. In many ways the UK has just kind of jumped on the back of the strength of North America and by following much of its model has emerged as the strongest economy of Europe. They would be fools to think any of this Euromania will last long. As for your trade, well its short term so who is to say what news affects it shortly. In the long run though, I would say the Pound and the Dollar will continue punishing the Euro for quite some time. After all the Canadians have been saying forever that eventually their dollar should strengthen on fundamentals and yet it hits new lows vs. USD every month it seems.

01-22-2002, 02:01 PM
I just got out of one of my packages at 386

for a profit of 37 ticks($463).Again,I am not recommending these spreads...yet!