The Race to Parity
Posted on October 13, 2009 by Yohay
Filed Under Forex News | 17 Comments
A new wave of dollar weakness brings the Canadian dollar and the Swiss Franc closer to parity. Both just made strong moves, but have different characteristics.
USD/CAD
The Canadian dollar made a move during Canadian Thanksgiving. After closing at 1.0421, USD/CAD went to the low 1.03s, where it was stuck above the support line of 1.03. This was a significant resistance and support line during 2003.
And now, when holidays around the world ended, the Canadian dollar enjoyed the weakness of the greenback and made a breakout. USD/CAD fell below 1.03 and is now trading at 1.0275.
On the road south to parity there’s no additional resistance support line. A round number is a psychological barrier, as well as an intuitive number to place stop loss order.
In the case of USD/CAD, parity isn’t only a very round number. 1:1 served as a support and resistance line in the past as well.
For more on the Canadian dollar’s week, read the USD/CAD Outlook.
USD/CHF
The second currency that’s getting close to parity with the dollar is even closer. The Swiss Franc made a strong move: USD/CHF fell from 1.0250 to just below 1.02. But here, there still a barrier.
USD/CHF bottomed at 1.0176 on September 22nd. Although it was a swing move then, it was followed by another dip a day later. Currently trading at 1.02, USD/CHF is closer to parity, but will have to overcome the 1.0170 support line.
Similar to the Canadian dollar, parity served as a support line in July 2008.
Both currency pairs traded below 1 during the winter of 2007-2008. This ground isn’t uncharted to them. Are they going to hit parity soon?
Further reading: About how Friday’s excellent employment figures in Canada got USD/CAD closer to parity.
Enjoyed the post? You may want to subscribe by RSS feed or Email.Tags: greenback,Parity,resistance line,support line,Technical Analysis,USD/CAD,usd/cad parity,USD/CAD Technical Analysis,USD/CHF,usd/chf parity
Comments
17 Responses to “The Race to Parity”
Leave a Reply
Popular Forex Posts
Daily FX Headlines- EUR/USD: Trading the U.S. ISM Manufacturing Report August 31, 2010
- EUR/USD Range Should Hold Ahead Of ECB Decision August 31, 2010
- Gold Stubbornly Higher August 31, 2010
- Swiss Franc Focus Remains on 10130 August 31, 2010
- Japanese Yen Trend Defined by Channel August 31, 2010
-
Stay up to date!
-
-
[...] Vehicle Sales will be of interest to loonie traders. USD/CAD now trades at 1.0280, still on the race to parity. For more on the Canadian dollar, read the USD/CAD [...]
[...] In Switzerland, ZEW Economic Expectations are expected to show more signs of recovery. At 1.0140, USD/CHF is getting close to parity. [...]
[...] Canadian dollar and the Swiss Franc, which are both racing to parity, have been set back by some dollar strength earlier on Thursday but are now retracing back to [...]
[...] In Switzerland, Retail Sales are expected to rise by 1.1% after last month’s 1% rise. A positive result will push USD/CHF closer to parity. [...]
[...] In Canada, the interest rate is expected to remain unchanged at 0.25%. Apart from the Overnight Rate, the BOC Rate Statement is expected to hint about future moves. Will the loonie reach parity? [...]
[...] Canadian dollar had a good start to the week, getting closer to parity, but was thrown back on weak data. This week is important for the loonie, with a rate decision and [...]
[...] them are currently within levels seen last week: EUR/USD is under 1.50, USD/CHF above 1.0120 (no parity yet), USD/CAD above 1.03, etc. GBP/USD is higher than last week, at 1.6420, but it has already seen [...]
[...] in the “race to parity“, Canada won’t be first – the Swiss Franc will probably get there earlier. [...]
[...] surplus this time – 1.59 billion. USD/CHF went as low as 1.0033 yesterday, very close to parity. It now trades at [...]
[...] The Swiss Franc continued the race to parity, getting 33 pips away this week. The SNB sells the Franc when EUR/CHF reaches low levels. EUR/CHF [...]
[...] Tuesday, October 27th: In Switzerland, UBS Consumption Indicator might help the Swissy reach parity. [...]
[...] Switzerland, the UBS Consumption Indicator is due today. USD/CHF is now getting away from parity. If you’re into the Swissy, check out James Chen’s recent technical analysis for this [...]
[...] was quite close to parity, but rose with the dollar’s strength up to 1.0248, a rise of about 150 [...]
[...] In Japan, Average Cash Earnings are expected to drop once again. In Switzerland, the SLVE PMI is predicted above 50 points, and perhaps push the Swissy towards parity. [...]
[...] USD/CHF: The Swiss Franc made gains against the dollar, and went down from 1.0260 to 1.0178, nearly 200 pips lower, and not too far from parity. [...]
[...] The Swissy was 35 pips away from parity, but settled for a smaller gain against the the dollar, closing at 1.0111. Senior SNB member, [...]
[...] The strong Swiss economy bounced off parity once again, being 47 pips from it this time. But the dollar’s strength swept the pair back up [...]