Board-Ansicht
Mix-Ansicht- and again: Polish Z l o t y! - Emerald, 07.09.2004, 06:18
- Re: and again: Polish Z l o t y! und dazu passte folgender Bericht - kizkalesi, 07.09.2004, 08:45
- btw: MAD? - BillyGoatGruff, 07.09.2004, 12:38
- Re: btw: MAD? - Emerald, 07.09.2004, 12:43
and again: Polish Z l o t y!
-->How, why and when exchange rates are subject to fluctuations
Outlook upon the 4th quarter 2004
The first eight months of the year 2004 have been marked by events in the currency market, which often surprised even professionals.
Exchange-rate forecasts all too often become invalid even before they have been printed out. All the same, if the foreign-exchange situation is closely followed daily and thoroughly analyzed, very substantial profits can be realized.
During the past months under consideration, there developed a certain craze to depreciate the American Dollar's value by talking and writing it down. The main causes apparently favouring a depreciation are well-known and need not be enumerated again. By viewing things in in an oversimplified one-way perspective, often based on mere wishful thinking, there is a big risk of misjudging the situation and suffering a loss.
By year-end 2003, one US-Dollar cost CHF 1.2423. Since that day, we have witnessed a 2004 maximum exchange rate of 1.3230, whereas later on the US-Dollar recovered from its low of 1.2140
and appreciated again against all expectations. The reasons are easy to determine: firstly, many sceptic market players hold short positions, secondly, the oil's all-time highs have receded somewhat since 20 August 2004, and thirdly lowest-level exchange rates cannot be taken for granted in case of President Bush's re-election. On the other hand, the economic news coming from Germany, France and Italy do not exactly shed a favourable light on the Euro currency. As an example presaging a doubtful future for the Euro zone, we mention the Monday Demonstrations in Germany.
The market's responsive sensors anticipate such fluctuations many weeks in advance, long before we are informed by analysts, specialist and traders of the reversed trend, getting thus advice to adjust our trades to the new situation, possibly by liquidating positions with a loss and reversing the direction of our transactions..
By engaging in Stillhalter foreign-exchange transactions based on currency pairs, the market player always is credited with a premium enabling him, almost without exception, to get unharmed through such periods. Moreover, there is always sufficient time at disposal in order to monitor and successfully get over daily and weekly currency fluctuations. To be sure, earnings are limited to premiums credited, whereas high-risk stop-loss transactions are a rarity in this field of activity.
On our part, we assume that the Swiss Franc will depreciate with respect to most international currencies during the coming months. It is our opinion that the strongest appreciation will involve the U.S. Dollar, the British Pound as well as the undervalued Polish Zloty.
Temporarily, the South-African Rand is subject to a slight depreciation, which keeps the currency nonetheless on a high level of consolidation after a bull market of four years.
To close our reflections, we would like to mention one last fact: for the first time, the price of gold can keep up with the rising dollar exchange rate, or even surpass it relatively. In a medium-term perspective, we thus expect a fundamentally improved assessment of gold as an asset.
Zug, 15 September 2004
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