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Swiss Franc Tumbles Then Soars, On Suspected Failed SNB Intervention
For those who slept through the recently-downgraded to junk "Snow Tempest In A Teapot Of 2005", you may want to check the stops of any open EURCHF trades, because, two weeks after the SNB shocked the world and blew up countless retail and institutional FX trading desks, as well as numerous macro hedge funds, the SNB - allegedly - tried to for round two earlier today, when just hours after SNB's Danthine - the same guy who said the EURCHF floor is the bedrock of SNB policy two days before the SNB eliminated it - said that "the SNB remains ready to intervene on foreign exchange markets" that this happened: a dramatic, 250 pips surge in the EURCHF starting at 3 am Eastern.
Naturally everyone started screaming intervention: "The market is on full alert for intervention," says Neil Jones, head of hedge-fund sales at Mizuho Bank Ltd. in London; "the SNB is saying they could intervene at any time; but there’s no confirmation, just speculation."
Indeed, there was none, and with liquidity in EUR/CHF far from ample, all it took was some speculation, some momentum, and thousands of stop losses activations, and you got an inverse avalanche.
And then this happened:
Yup: a full reversal... with the EURCHF trading to below where it started before the suspected SNB intervetion, and promptly the narrative changed. The full blow by blow from Bloomberg:
- CHF Pares Losses vs EUR, USD as Intervention Talk Fades: Trader
- EUR erases gains vs CHF to fall ~2.90% from 1.03826 peak earlier, trading as much as 0.68% lower for the day at 1.00822.
- EUR/USD positioning is now less crowded, FX sales trader says
- Interbank names and some accounts that were stopped of their EUR shorts on squeeze higher sold EUR/USD, pushing the pair below 1.13
And then there was a suggestion that the EURCHF was merely trying to minimize its month-end P&L on its massive EUR holdings, however it promptly retracted its bid when it realized it was just adding fuel to the fire.
At the end of the day, it is unclear if the SNB did or did not intervene again: if it did it was simply to mimic the PBOC and keep traders off balance, to smash all stops, and to make sure nobody has any standing stop-loss orders in the pair. Of course, it may have simply tried to spread a rumor of its intervention to gauge how deep the liquidity in the pair is.
This is what the entire move looked like from start to finish.
And now we wait to learn if any more FX traders blew up on this far more modest, if just as illiquid move.
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everything seems normal. Am I broken?
I would lol hard if the SNB jumps into the market at random times just to fuck with the people frontrunning the EUR's demise.
"How many hedge funds can we blow up in a single year?"
Swiss Franc Tumbles Then Soars
Yeah.....totally didn't see it coming.
Moar Viagra next time.
But if it stays up for more than four hours, should I be worried?
More FX traders to file bankruptcy. Good job CBs. (Oh, I don't feel too bad for the traders.)
in case you didn't bother to read the last sentence of the first paragraph, here it is:
For those who slept through the recently-downgraded to junk "Snow Tempest In A Teapot Of 2005", you may want to check the stops of any open EURCHF trades, because, two weeks after the SNB shocked the world and blew up countless retail and institutional FX trading desks, as well as numerous macro hedge funds, the SNB - allegedly - tried to for round two earlier today, when just hours after SNB's Danthine - the same guy who said the EURCHF floor is the bedrock of SNB policy two days before the SNB eliminated it - said that "the SNB remains ready to intervene on foreign exchange markets" that this happened: a dramatic, 250 pips surge in the EURCHF starting at 3 am Eastern.
(123 words)
!
!
Only one way to really understand the timing of the
Global ECONOMIC AND FINANCIAL COLLAPSE.
fact is that the CHF is "wobbling" after so long hiding under the skirts of the EUR, and there is a battle going on for the psychological level it "ought" to be
most Swiss I talk to would prefer a parity to the EUR, and many that were against the previous floor are wondering out loud if their opposition really brought what they wanted
so yes, while SNB intervention can't be excluded, you can expect lots of battles between bulls and bears on the CHF front, in the near future
---
OT: Pro-Kremlin media budgets are being cut by half, this year
this includes RT (from 445 million per year in 2014 to 236 million) and Rossiya Segodnya (from 250 million per year to 100 million for 2015)
as far as I am informed, this will have an influence on the whole legion of (I don't want to use the word "troll") young devoted pro-Kremlin paid blog commenters on sites like ZH
in case you notice in the near future a change in the tone of comments on some issues, this might be an explanation. some of them I will miss, some of them... less so
I am excited to get rid of paid trolls on both sides.
When Brussels goes tits up -- will you still post?
You mean I could actually get paid for this?
well probably not with my attitude
How much is your soul worth?
Make me an offer.
I'm human.
For many, an eternity in hell is not all that different than what they feel now. That's how the deal is made.
They should put your picture in the dictionary next to the entry for "shortsighted"
I was just adding to the previous comment that nearly every Swiss small/medium businessman I know exchanged his CHF cash holdings in EUR, judging this "regime change" a splendid opportunity. This was a bit of a surprise to me, and is of course completely anectodal
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Haus, how often do you have to conflate Frankfurt/the ECB with Brussels/the EU? it's tedious. you damn claim to live in Frankfurt. you don't need a map, do you?
just a question: how on Earth do you think anybody either in Frankfurt or Brussels would pay for what I write? If you would read my comments a bit more attentively, instead of fuelling your passions, fears, hopes and pet hates, you would notice that I'm not exactly a... nice talker of several important features of the whole european setup you so egregiously put in the same drawer
to be frank, the whole level of discussion here went so damn "tits up", as you say, that I am seriously thinking of saying goodbye to all that
The reason I conflate the two, is they are tied together to such an extent at this point & time that the suprise unraveling of the EUR -- I think would bring about the end of the EU -- as litigation without end from one member state to another, or citizens of one member state suing another would end up in the ECJ, and things would get out of control in this sense.
See Ghordo, at this point in time I see one of two outcomes for the EUR --
1) Adults start running the show, and split it in half. I don't see this as likely at all. I think the current EU leadership will continue with the (forgive me from steling from Hunt for the Red October) "Capitan, Engineer reports reactor to 105% possible, but not recommended..." "Go to 105% on the reactor ..."
https://www.youtube.com/watch?v=IZB3ZclZtZg
Type of insanity. In essence the EMZ is experiencing pains by grouping dissimilar people together under one monetary policy. E.g., integration was far too quick, so their solution to this problem is even quicker integration. (E.g., the social equivlant of solving a debt crisis with more debt)
Slowing things down, and reversing the process would be the way to achieve their goals -- but luckly for all of us -- it appears they are too impatient for such a thing.
If such a path is taken -- the fiscal union would be destroyed, but it would likely preserve the political one, and give the continent an opportunity in the future to try the fiscal union again again in the future when the dust settles -- perhaps this time with a cooler head.
2) Wait for something to go *boom* https://www.youtube.com/watch?v=z07RZUdEOqc at which in the chaos, not only would the fiscal union wrip itself apart -- but in the chaos of peoples savings, houses, jobs and anything of value save stuff that is nailed down evaporating -- it would likely take the political union with it.
Of course it will be 2)
It's much easier to wait for something to blow up and then play the blame game. I just have a feeling that "they" (EURO bulls) are desperately waiting for the *boom*, even trying to encourage it somehow, but it just won't come! There is a certain danger that the EURO might go *boom* first. But at least the others would then have a scapegoat.
Sure. I am waiting for it to go *boom* --
I have been saying for years we are one Krakatoa event away in the EMZ from the whole thing imploding. That said -- there has yet to be one, and this is why the Greek election is so interesting. If Greece unilaterally defaults on its obligations and refuses to pay, the domino effects in the rest of the EMZ would quickly wipe out the PIIGS then France and then its game over.
It won't come for a while until one day when it will. Then things will move quickly.
Lastly, you hit the nail on the head with the "blame game" as all the EUR nations point the finger and blame everyone else for the failures of the common currency -- which is why the *boom* scenario would wipe out the EU.
"Those Spanish -- them not paying their bills is the reason you lost your pension, your house, your job, your savings, etc., etc., but hey -- we are best friends and do everythign together. Thank God for the EU."
so you don't only expect the EMZ to break up... during a currency war between China and the US
you also expect that half of the real trade and production - the intra-european flows - would be trashed by the trashing of all the treaties and regulations that are "the EU"
we don't seem to live on the same planet, methinks. I can accept that you see yourself as an expert on the EUR, but you don't seem to have a grasp on the real economy
You tell me I don't know anything about the real economy, yet assert the currency way is only between the US and China, with the later having a peg on the former. Irony? Or are you just attempting to be funny?
Half of real trade!? What are you talking about? Trade in Europe is flatlining and declining in the PIIGS. Is it a big chunk of trade? Yeup. Absolutely! However, it was a larger chunk of each nation's economy before the EUR, and before the EU. Everyone go revert back to EEC levels of cooperation. But you hate ideas like this, not because they would be more efficient, or because it would be fairer, but because if is an admission that the "all European peoples are the same" storyline we have been feed is a huge, stinking, pile of crap.
We don't live on the same planet. Ive known this year some time now. You live in a Disneyland ride, and I live in reality.
I post this up here almost weekly, mocking you;
https://www.youtube.com/watch?v=7jiaU0xbOKs
Not because I want to be mean, but I am hoping I can illustrate to you how insane your ideas (or perhaps ideals would be a better word) of humanity are. The best way to improve the human condition is to harness the greed in everyone for the betterment of everyone. Forcing one group of people to pay for another group of people is not the way to go about doing this.
Your "However, it was a larger chunk of each nation's economy before the EUR, and before the EU. Everyone go revert back to EEC levels of cooperation." leaves me very puzzled
are you suggesting that the EU or the EUR or both led to a decrease of trade among the partners?
Yes. Here simple questions:
When were more BMWs sold in Greece/Spain/Portugal/Italy;
a) 2015
b) 1998
Next, before you answer -- back out non-domestic sourced debt.
BMWs? most trade is not about well known end-consumer products
and your choice of years for the comparison...
have a look at this very interesting graph and this interesting article. Reality and real trade are a bit more complex then "BMWs sold in Southern Europe"
Your chart supports my point.
BMW was just an anology, but one that is on point, as budgets get tighter, those without funds to pay their electricity bills aren't looking for a 80€ Bosche toaster anymore, but the 10€ equivlant thereof from China.
North of Europe specializes in high-end "over engineered" goods with wide profit margins. For these companies there is a sweet spot in competeting with lower cost goods. You can lower your price to a point before you would be better off selling less at a higher price.
that chart? imho that chart supports no point whatsoever. on the contrary, it supports that both the EU and the EUR are less relevant then anything else
"the currency way is only between the US and China" - then I am very curious how you see the currency war. I don't remember you posting anything on that, but it might be my bad memory
The Japanes are in there as are the Brits, and the DM was still alive, it would be a larger CHF right now.
Now, this is where you tell me it would kill German exports, and I bring up energy and raw materials costs, at which point you quit answering.
"I am hoping I can illustrate to you how insane your ideas... "
yes, I noticed that you find ideas that are completely mainstream in the country where you live completely insane. I've also noticed that you project many of those ideas on me
to be frank, your diatribes on how common Germans see their place in Europe are, imho, a bit misplaced on my doorstep. nevertheless, I still don't find your funny video a convincing argument...
... for me changing my mind on something I never set my mind
The only reason its mainstream is becaue saying it isn't true gets you labeled a Nazi.
I encourage you to live in the Fatherland for a while, make a few German friends that have nothing to do with the "expirment" and then ask their thoughts. You would be shocked.
May I point out that my German is fluent? (I could claim way more, but I don't think you would believe it). Sorry, but the "labeled Nazi" part... I know very well, and I have friends in Germany that are the full monty of "respectable only for the far right". but this has little to do with the anti-EUR movement, I fear. and sometimes I ask myself if your gf is not from Dresden, and highly influential on your views on Germany. you do speak mostly in English with your German friends, don't you?
note that I'm not trying to say that you have less insight in German minds then me. but I would be surprised if you had, at your age, more Germans friends, relations, relatives and godchildren then me. of course, my German friends tend to be... on top of the status quo. taxidrivers and waiters are actually some of my more... frank sources, and that's not much
Agree. Things will move quickly. And the Greeks will probably cause such an event. I only see three possible outcomes for Greece:
1) Syriza bows to EU and keeps austerity package with some minimal changes --> millions of Greeks will go to the streets (yet another election fraud!) --> Euro might survive for a bit, but for how long?
2) Syriza manages to "renegotiate" substantial debt relief, haircut or further direct help --> Spain, Portugal, Ireland, France, Italy, etc. will already be lined up for the same treatment and they will all opt to water down any strict "German-style" rules --> ECB and Euro will not survive
3) Syriza doesnt manage to "renegotiate" but stays "stubborn" and announces publicly it will not pay back parts of their debt or all their debt but rather default on it (and go back to Drachma?) --> Greek voters would be supportive of Syriza (at least in the beginning?) --> ECB and Euro will not survive
All three possible outcomes would be catastrophic (1 the slowest, 3 the most violent)! Why is everybody still so calm? Is there a fourth or fifth possible outcome?
Syriza might just step on the can that has been getting kicked for so long. We can only hope.
don't get your panties in a knot(another colloquialism for ya) Ghordius, this is fight club after all, just swing and shrug
whether others agree or disagree with you, I'm sure many here do appreciate hearing a different persepective from someone on the other side of the whole EU debate
the average American, and the atypical American education simply cannot see the whole EU experiment as anything less than "communism/statistism/powergrab against the common man", which really speaks more about the indoctrination of Americans, and the fact they can't see anything beyond their "American lens" than anything else.
Americans are motivated by fear and cynicism. I should know - I became one and then decided I hated what I had become. Moved back to 'communist' Europe and you know what - life is actually pretty f..ing good over here. And the coffee is awesome. Healthcare - well, I pay 10% of what i paid in the U.S. To each his/her own.
interesting views, thanks. the EU "as anything less than "communism/statistism/powergrab against the common man" "?
I still have a bit of a problem grasping this feeling
The common man of Europe had to show his passport at every border, had to have a permit to work in the neighbouring country, had to have a permit, in certain cases, in order to have his money cross a border and many services and goods were more easily sold overseas then in the country next door
further, before the EU many industries were completely in the hands of the state and of a monopolistic nature
I can understand those who claim that the EU is too neo-liberal, but the EU as a communist or statist powergrab?
and this "motivated by fear and greed" is something I find even stranger. as often, I find myself a bit at loss and wish I had traveled the US a bit more
Hey, if you want substantive discussions devoid of biased or emotional diatribe point your browser to Evil Speculator. We're all about the coin and we always fade the paper.
I don't mind the emotional diatribes, I just miss the substantive discussions on certain themes
Interesting info on Russian media budget cuts .... some zio news rag as the source no doubt?!
then do quote the official Russian budget for 2015. btw, nice nick, I am myself a decleared enemy of the TTIP deal
The only quote on the matter comes from a western backed news source from January the 16th.
------------------
Vedomosti (Russian: ?????????, literally "The Record") is a Russian language business daily. It is a joint venture between Dow Jones, the Financial Times[1] and Sanoma, the publishers of The Moscow Times.
------------------
Then a propaganda touch was applied to it by a writer out of Berlin who gets a hardon by squeezing "Putin" into his article names. His latest tweet:
-----------------------------------------------
Leonid Bershidsky for bloombergview
http://www.bloombergview.com/articles/2015-01-23/putin-s-propaganda-indu...
Leonid Bershidsky @BershidskyOf my two pieces today, one is good and the other has Putin in the headline. Guess which one is popular.
-------------------------------------------------
But you knew this already.
As for the article .. no budgets are being cut in half. The Rubel devalued by ~40% ....modest adjustments were made like they would have in any other country. There is also extra financing that occurs throughout the year .. as the article mentions.
Again this budget is on the same level as DeutscheWelle and still a joke compared to what the BBC uses up.
Am also again the TTIP ; )
JustTheTTIP, thanks
"...as far as I am informed...."
You are uninformed, period.
yes, as far as I am informed, which is a formula often used among polite people in order to convey: treat this info as you like, I won't underpin it with sources
"I would lol hard if the SNB jumps into the market at random times just to fuck with the people frontrunning the EUR's demise. "
Blowing up speculator parasites should be job #1 for the SNB.
Some people got FX'd
The central banks are in total control. You can bet they made money and the small investor got hosed....again. It's all Bullshit!!!
Not only are FIAT Paper Currencies Worthless, they're Bipolar too. Hillarious.
When gamblers are involved, apparent rationality disappears. Complex mathematical equations to explain and justify a bet. Geniuses all.
I would say that Goldman placed a call to help them get out of their positions, but normally they would just cancel the trades.
Better they cancel the trades then come to me for the bailout....but it is all completely fucked. I almost feel sorry for those who have made this their occupation, in the same way I feel for a pusher on the street. Just trying to make a good living off of the stupidity and weaknesses of others.
Just when you think things couldn't get more farcical, they do.
There behind a glass is a real blade of grass
be careful as you pass.
Move along! Move along!
Come inside, the show's about to start
guaranteed to blow your head apart
Rest assured you'll get your money's worth
The greatest show in Heaven, Hell or Earth.
+1 for the Emerson, Lake and Palmer reference.
Brain Salad Surgery, indeed!!!
Been sifting through old concert ticket stubs lately (new av is RUSH 1979)
Saw ELP in Aug98 opening for Deep Purple. Couldn't stomach more than three DP 'tunes' after the mind-blowing performance of ELP. Actually walked out LOL
Where are they now? r40 comin' at ya!
1. Central banks will always move a currency pair against the majority of the speculators
2.Central banks will always move a currency pair to bang out 98% of the speculators stops.
3. Any Speculator who can learn to trade off the timings when central banks go stop hunting with layered postions waiting will become a very wealthy rabbit in short order
:-)
might as well peg it again, LOL.
Well that was quick!
We're not intervening!
We're intervening!
Gosh it is almost like someone in the know could profit from this stuff. Gotta love free markets.
sadly, when we hear "free" it is usually the precursor to a good ass raping, and that has now become the meaning of "free markets". Just another contrived illusion to give people the belief they actually have an even chance.
I hear "free" and I run.
Maybe they've got the order to "win the lost money back".
Casino-style
Little did I know, when, as a tot, I liked to ride the Tilt-a-Whirl at local fairs, that it would become a reasonable metaphor for how it feels to participate in today's world economy.
Chrysler Building! What next?
The force is strong with this farcex.
SNB tried to "draw" a Matterhorn just for the fun of it. But they got the incline wrong. Too steep!!!
http://img2.wikia.nocookie.net/__cb20140330002053/senpai-club/images/e/e...
http://www.bloomberg.com/news/2015-01-27/netherlands-increases-gold-hold...
Rebels capture Ukraine commander in Donetsk airport fight, force prisoners to face angry crowds
Well, if SNB really tried to "intervene" today, I must say Mr jordan is even more stupid than anyone around. He would have to buy all of ECBs QE in order to maken any kind of impact. Actually I wonder if it is not a couple of traders who tried to spread a rumor. Still lots of short Swissies out there to be covered.
They can fail. But they can't quit.