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Signal

Currency Date Time Strategy First Target Second target
EUR/US$ (buy) 02-07-07 13.00 Short term, buy at 1.3450 1.3480 1.3510
EUR/US$ (sell) 02-07-07 08.40 Short-term, sell at 1.3580. Sell again at 1.3620 1.3540 1.3480
US$/CHF (buy) 02-07-07 13.00 Short term, buy at 1.2115 1.2145 1.2175
US$/CHF (sell) 29-06-07 13.00 Short term, stay short from 1.2330 with a 1.2276 stop loss to protect gains 1.2285 1.2255
AUD/US$ 02-07-07 13.00 Short term, sell at 0.8570 0.8460 0.8360
US$/CAD 02-07-07 15.00 Short term, buy at 1.0570 1.0610 1.0650
EUR/CHF 02-07-07 15.00 Short term, sell at 1.6520 1.6290 1.5960

Forex News

Swiss Franc Gains Most in Week as Manufacturing Growth Quickens

July 2 (Bloomberg) -- The Swiss franc surged to the highest in more than three weeks on speculation faster manufacturing growth may prompt the central bank to raise lending rates, reducing the appeal of so-called carry trades.

The currency rose by the most in more than a week versus the euro after Credit Suisse Group said an index based on a survey of about 200 executives rose to 62.8 from 58.9 in May. Economists forecast a gain to 59.9, according to the median of 12 estimates in a Bloomberg News survey. The currency also benefited as investors bought European bonds, as they sought the safest assets after failed terrorist attacks in the U.K.

``Policy is beginning to move against the carry trade,'' said Michael Metcalfe, head of macro strategy at State Street Global Markets in London. ``Any strong data will make it easier for the Swiss National Bank to tighten, and that will have an impact on the franc.''

Against the euro, the franc rose to as high as 1.6463, the strongest since June 8, and was at 1.6483 by 4 p.m. in Zurich. The Swiss currency also rose 0.8 percent to 1.2125 per dollar.

A reading above 50 indicates expansion in the manufacturing index, which Credit Suisse compiles with the Association of Purchasing and Materials Management. ``Industrial activity has returned to a faster-paced expansionary course as we reach the mid-point of the year,'' Credit Suisse said in a statement.

The franc has still lost almost 2.4 percent versus the euro this year so far as investors used so-called carry trades to take advantage of Switzerland's low 2.5 percent interest rate to borrow the franc and use the proceeds to fund other higher- yielding purchases. Only Japan has a lower benchmark rate than Switzerland among the major economies.

Swiss government bonds fell. The yield on the 4.25 percent note due 2017 rose 1 basis point to 3.23 percent, leaving the price at 108.61. Bond yields move inversely to the price.

The bonds earlier rose with other bond markets across Europe as investors sought safe haven assets after the U.K. Home Office raised its terrorist threat assessment for the country to ``critical,'' after failed car bomb attacks in London and Glasgow over the weekend.

Wave analysis for GBP/USD

On Friday pound broke the critical level suggested in the main scenario so it is quite reasonable to suggest that US dollar should be weakening until the end of this summer or maybe even until the end of this year. Current wave counting favours this scenario.

GBPUSD wave analysis for 2007

Monthly wave counting for GBPUSD (June 2007)

Wave counting on a daily chart:



It is likely that second link wave XX of the global triple zigzag (B) is now forming. It is not clear what shape it would take though. Critical level for wave [x] of XX is at the end of wave [w] of XX.

Wave counting on 480 chart:

It is possible that upward impulse (a) of [x] of XX has been formed. If this is true then after correction (b) one more impulse may form or maybe a diagonal triangle (c) of [x].

Analyst of Alpari Ltd: Dmitry Voznuy

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