Aug 182020
 

The two market forces were evidently clear at the start of pandemic up to the bullish recovery of the market. Safe haven pairs moved in tandem while risky pairs were pretty much in unison. Before I continue, here’s a ranking of which stands as the top choice of safe haven.

In the presence of fear, this is the ranking:
JPY
CHF
USD
EUR
GBP
CAD
NZD
AUD

In the presence of greed, this is the ranking:
AUD
NZD
CAD
GBP
EUR
USD
CHF
JPY

What I have noticed in the past month or so, there are some currencies that moves against the general market sentiment. First, AUD and CHF, ironically 1 is a risky asset while the other is a safe haven, has been moving the same. They are both clearly tracking gold. NZD has been remarkably weak where it failed to keep its long-term trend intact against most currencies. JPY moves at the extremes as usual although there are times when some other currency would just take its top or bottom spot.

In my opinion, the currencies are all recalibrating itself. After bulls and bears senselessly tore them apart and took them to unreasonable highs and lows, the market right now seems to be bringing them back to its proper place. Having said this, it becomes futile or even counter productive to remain thinking of what the general market sentiment is and trade on it. We should be better off by just observing the pairings of the base and counter currency against all other majors and trade on that.

Trader H

TraderH is a foreign currencies trader and a former Certified Securities Representative in the Philippine equities market. All posts herein are personal views and are not endorsed by any organization whatsoever. It is important that you practice due diligence in your trade plans. This website and its authors will not be held responsible nor liable to any of the reader's losses.

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