Here we are, day before Thanksgiving. Relatively slow day, especially when compared to recent volatility. Even couple of fairly important news failed to spur currencies. EU announced its own stimulus package, to the tune of EUR 200 billion, while China cut interest rates to prevent economic slump. Markets must still be digesting the $800 billion borrowing boost declared by FED yesterday. I didn’t have time to get into details of that yet, but if banks are forced to  lend money it is possible that big part of it will go to unqualified borrowers and then we are right back where we started. Should they employ due diligence and sound lending practices, than surely FED’s mandate will not be fulfilled.
This whole situation sounds very promising, but is murky at best.
There was one exception to otherwise dull day- Swiss Franc. CHF came under pressure across the board. This gave me reason to reenter NZD-CHF long trade.

Price spiked down to about 0.6410, level I considered “attractive”, and started to move up. I bought at 0.6482, with 0.6600 objective. It came relatively fast. I’m not going to pursue it any farther on 1H chart. In my view favorable set up is just about exhausted on this time frame. Higher magnitude chart, 4H is starting to look promising, but it might be few days before there is a possible trade.
Tomorrow, Thanksgiving day, is just about a dead day for trading. Some brokers don’t operate at all, some will permit trading but the spreads will be awful. In general it is not worth while trading tomorrow. Far better to enjoy time with family, or just a break from computer and charts. The night after the dinner, however, might be another story(US time). Here is a snapshot of USD-CHF from Thanksgiving night 2006.

And USD-CHF in 2007

I happened to take trades on both occasions. Results are not as important as movement. It is very possible we will see it again, during European session. I don’t try to encourage anybody to trade, because there is no way of knowing if there will be any opportunities. For traders who never trade European open, because of their schedule, work etc, this might be a rare chance to follow the markets at this time, since most people have Friday off. Happy Thanksgiving!

Mike K.