Is CHF rallying because it expects the Fed to ease or because it expects the Fed to stand pat? Wouldn't Fed easing be good for asset markets, lessening the need for the "risk off" trade, and CHF negative? Wouldn't Fed standing pat be bad for asset markets, causing a reversal in today's rally, and driving even more money into CHF?
Well, partly because I don't want to run into a QE3 announcement when the Fed speaks later today. Second, because EURCHF was the main anti-EU trade in the speculative community - I want to fade the most popular, crowded trade of leveraged trend-followers.
So Bernanke speaks tonight? He will trigger of a 1 month rally probably with people and pundits in the fall crying leaders should come together and act decisively to reverse the drop...cause the August fix was burned out.... Its all as much predictable as it is depressing.
Most in the FOMC thinks the Fed should hike 1st then sell assets. Now the earliest they will sell has a deadline