Not my own idea but Kyle Bass points out 80% of the HKMA's "war chest" currency board reserves have been used maintaining the upper peg. Trumps trade war is putting extra pressure on this peg breaking. Last time we saw a peg break was the SNB Frac's +30% 1500+ pips in 5 minute appreciation. There are only three routes for them they can raise more money in the...
Most of the time this pair isn't really tradable. It's just an interesting record to see how it deal with the patterns! Let's see how it goes!
Possible scenario. Watching for bearish break of trendline. If so, would watch for price to reach key level as noted in the market, which also happens to land at 61.8% fib level. For educational and demonstration purposes only. Trade at your own risk.
This is an excerpt from MACRO BRIEF: Hong Kong Dollar Strengthens on Rate Spike originally published March 10, 2019. The short-HKD trade is nearly consensus, which reminds me of the short-yuan trade a few years ago that was largely snuffed out by the PBOC. Problem here, though, is the HKMA's attempts to draw in HKD inflows have been superficial at best....
2018 saw a rolling bear market in emerging markets, with a lot of EM currencies getting crushed vs. the dollar. Why has everyone forgotten about this? The issues are systemic, and the buy-down of the USDHKD peg only kept the eurodollar market functioning for long enough to forestall some further pain. Now that the peg has been hit again, we are starting to yet...
Unsurprisingly, right as the USDHKD Peg hit it's 7.85 limit, China lost its ability to prop up the Yuan, and the Yuan started to fall once again. This is further confirmation that the Yuan is subject to dollar pressure, and Hong Kong is China's "release valve" for dollar funding pressures. When the peg gets hit, the CCP has a difficult time keeping the RMB afloat.
Looking at this chart you will see the Hong Kong Dollar as it compares to the Dow Jones as of late. Notice, that each time the Dow Jones "sells off" it is preceded by a devaluation of the Kong Kong Dollar. Bought and Paid for by China.... :)
The Value of this currency pair is at an all-time high. A level that has never been breached and exhibits an unnaturally potent downward force on price. Buying at this level would most likely turn out to be a giant mistake. As such, selling is the only option. Wait for RSI crossover and place stop above resistance. If this coincides with spring equinox then a...
USDHKD is a proxy for monetary "stuff" going on in China. China can stimulate when this peg is not being hit as most of their dollar funding seems to be running through Hong Kong. When the peg gets hit however, we see noticeable problems and effects around the world. We are now about to see the peg get re-hit once again, which will likely kick off another wave of...
This pair is a fixed pegged currency pair ....right now price is just 10pips away from 7.8500 peg price. Going short is the only way for this pair at the moment except there is a change on the agreement on how this currency pair is managed.
USDHKD Timeframe: 1D Direction: Short Confluences for Trade: - Pegged currency @ 7.85 - Stochastic Overbought momentum - Price action at Horizontal Resistance Trendline (Central Bank defends at this level) - The opportunity appears again similarly to our previous USDHKD trade; minimal risk involved) Suggested Trade: Entry @ Area of Interest 7.8450 -...
USDHKD Timeframe: 1D Direction: Short Confluences for Trade: - Pegged currency, strongly defended at 7.85 (Limited risk; any break above the 7.85 levels is gonna be a crisis issue) - Stochastic Overbought momentum - Not directly related but Double Top Resistance for the DXY, helps support the drop in USD strength Suggested Trade: Entry @ Area of...
"The HKD is floating in a band of 7.75-85. The Hong Kong authorities are committed to intervening when the band is in danger of breaking to either side, and they have the reserves and financial power to do so."
USDHKD hit both upside/ downside Targets as it continues to trade sideways within a 1D Rectangle (RSI = 56.376, MACD = 0, ADX = 22.206, ATR = 0.0029). We will continue to scalp (buy low, sell high) the 7.84225 - 7.84890 zone until it breaks convincingly. 1W Highs/Lows = 0 are in support of extending this sideways movement.
USDHKD is trading within a 1D Rectangle (RSI = 55.573, MACD = 0, Highs/Lows = 0.0003, B/BP = 0.0018). We sell at 7.8489 and buy at 7.84225.