USDHKD trade ideas
USDHKD One of the best buys in the market.The USDHKD pair just formed a 1W Death Cross this week but the current 1W candle is a green one. The reason is that it is rebounding after reaching last week the 2-year Support Zone. We believe that we will see an aggressive rise next that will approach the Lower Highs trend-line. Our target is just below it at 7.82500.
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USDHKD Bounced off the 2022 Support! Strong buy!The USDHKD pair hit amidst Monday's turmoil the top of the Support Zone that was established back on the week of December 05 2022 and instantly rebounded. This naturally shows the strong technical demand of that level.
Even tough another 1-2 weeks of consolidation is possible, on the long-term, we expect a test of the May 01 2023 Lower Highs trend-line. Our Target is 7.8300.
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USD/HKD Trading Signal: SellDear Traders,
Our analysis using the EASY Quantum Ai strategy suggests a potential Sell opportunity for the USD/HKD currency pair. Please find the detailed signal below:
Direction: Sell
Enter Price: 7.80837
Take Profit: 7.80693667
Stop Loss: 7.80964667
Justification:
1. Technical Analysis: We've detected a downward trend formation in short-term charts, which is supported by a series of lower highs and lower lows, indicating bearish momentum.
2. Resistance Levels: The 7.80837 price level is identified as a strong resistance zone, where the price has frequently reversed.
3. Economic Indicators: Recent economic data from the US suggests potential weaknesses compared to the stability of HKD, adding to bearish pressure on USD/HKD.
4. Market Sentiment: Current trader sentiment leans bearish, as indicated by volume and open interest metrics in futures markets.
Please act accordingly and manage your risk effectively. Market conditions can change rapidly, so it's essential to stay updated.
Happy Trading!
Note: This forecast is generated using the EASY Quantum Ai strategy, which combines historical data analysis, machine learning, and advanced algorithms to provide optimized trading signals.
Trade Signal for USDHKD PairDirection: Sell
Enter Price: 7.81036
Take Profit: 7.80840333
Stop Loss: 7.81196333
We have generated a trade signal for the currency pair USDHKD, with a SELL direction at the entry price of 7.81036. The Take Profit target is set at 7.80840333, and the Stop Loss is placed at 7.81196333. This forecast is developed using the EASY Quantum Ai strategy.
Rationale Behind the Forecast:
1. Technical Analysis: Our quantitative models have identified a potential bearish trend for USDHKD based on recent price action and momentum indicators. The pairing shows signs of a downward movement after several key resistance levels have been tested and confirmed.
2. Market Sentiment: Current sentiment data indicates increased bearish positions by institutional investors in the Forex market for USD against HKD. This aligns with our sell signal and entry point at 7.81036.
3. Economic Indicators: Recent macroeconomic data from the United States and Hong Kong suggest a weakening of the USD against the HKD. Factors such as interest rate differentials and inflation rates play a significant role in this correlation.
Please execute this trade cautiously and ensure to monitor market conditions closely. Adjustments may be required based on live market behavior. Always adhere to your risk management policies.
USDHKD Be ready for a long-term buy.The USDHKD pair has been giving us excellent trades in the past 12 months and the latest (April 18, see chart below) almost hit our 7.79500 Target about 3 weeks ago:
With the price approaching yet again the 11-month Support Zone, there is no reason to diverge from this successful pattern. Right now by being so close to the Support Zone, the R/R ratio favors buying towards the Resistance Zone.
Our Target will be slightly lower at 7.83900 (April 08 High).
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USDHKD - In Downtrend with Symmetrical TriangleUSDHKD in 1h time frame chart is printing Downtrend with Symmetrical Triangle pattern and there is no any divergence in RSI. Therefore market may seem more inclined to move in the direction of the existing trend.
Hence I'll take short trade with Sell Stop Order on the breakdown last Lower Low level with stoploss above at last Higher Low level.
USDHKD Approaching the 2-year Resistance Zone. Major Sell.The USDHKD pair has been rising since November 2023 after hitting the Support Zone and is approaching the 2-year Resistance Zone. The Sine Waves help us understand the cyclical nature behind it. This is a low risk sell opportunity for the long-term. Our Target is 7.79500 (top of Support Zone).
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USD HKD Bullish TrendUSD HKD Bullish Trend is trading in bullish trend printing Higher Highs and Higher Lows in a bullish pattern.
Thanks
USDHKD Wave trading continues for high percentage profits.We have been using the USDHKD pair for wave trading for a very long time (see standard example below) due to its distinct characteristic and tight correlation:
It is more than obvious on this 1D chart that the application of the Sine Wave tool gives high probability entries and exits for bottom/ top buying and selling. Currently we are on an uptrend that should start topping in February. That will be our next low risk trade and it will be a sell. Profit taking will be made towards the end of June as the Sine Wave approaches its bottom.
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Fixed Exchange Rates: Benefits and LimitationsFixed exchange rates, a cornerstone of international finance, play a pivotal role in shaping global commerce and investment landscapes. This article delves into their intricacies, exploring the historical evolution, practical understanding, and the balance of benefits and challenges they present.
Historical Context of Fixed Exchange Rates
The concept of a fixed exchange rate system dates back centuries, but its modern incarnation emerged prominently with the Bretton Woods agreement in 1944. This fixed exchange rate regime established stable currency rates by pegging them to the US dollar (USD), which was convertible to gold.
This arrangement aimed to provide international monetary stability by preventing competitive devaluations and promoting economic growth. However, by the early 1970s, the Bretton Woods system collapsed, leading to a shift towards more flexible currency systems. Despite this, pegged exchange rates continue to be adopted in various forms by several countries.
Understanding Fixed Exchange Rates
A fixed exchange rate is a system where a country's currency value is tied to another major currency or a basket of currencies. In this regime, the exchange rate is maintained within a very narrow range. Countries with fixed exchange rates adopt this approach to stabilise global trade and financial relations.
A real-world fixed exchange rate example is the Hong Kong dollar (HKD), which has been pegged to the US dollar since 1983. Under this arrangement, the Hong Kong dollar is maintained at a fixed value of approximately 7.8 to the US dollar. This stability is achieved by the Hong Kong Monetary Authority, which trades the local currency against the USD as needed. You can see how this relationship has unfolded throughout the years with USD/HKD charts in FXOpen’s free TickTrader platform.
The predictability offered by a stable rate is typically advantageous for international trade and investment, but it requires significant reserves of the pegged currency to maintain its value.
Fixed Exchange Rate Pros and Cons
While many economies choose a floating system nowadays, there are pros and cons of a fixed exchange rate.
Advantages of a Fixed Exchange Rate
Stability in Global Trade: Pegged currencies reduce the uncertainty and risk associated with floating currencies, making it easier for businesses to plan and engage in international commerce.
Reduced Risk in International Investments: Investors are more likely to invest in countries with stable currencies, as it lowers the risk of losing money through price fluctuations.
Control of Inflation Rates: Countries can maintain low inflation levels by pegging their currency to a stable, low-inflation economy.
Prevent Competitive Devaluations: Such a regime prevents countries from engaging in competitive devaluations, which may lead to a 'race to the bottom' and global economic instability.
Increased Policy Discipline: Anchored rates can impose discipline on a country's fiscal and monetary policies, as maintaining the peg requires consistent, responsible economic management.
Simplified Transactions: A fixed currency simplifies the process of global transactions by providing predictability in exchange costs, reducing the need for complex hedging strategies.
Disadvantages of a Fixed Exchange Rate
Overvaluation or Undervaluation: Maintaining a fixed rate might lead to misalignment, where a currency may become overvalued or undervalued relative to its economic fundamentals.
High Costs of Maintenance: To maintain the peg, countries often need to hold large reserves of foreign currency, which may be costly and economically inefficient.
Lack of Monetary Policy Flexibility: Countries lose the ability to set their own interest rates and conduct independent monetary policy, as they must focus on maintaining the peg.
Vulnerability to External Shocks: Tied exchange rates can make a country more susceptible to economic problems in the nation to which its currency is pegged.
Risk of Speculative Attacks: If investors believe a currency is overvalued or undervalued, they may engage in speculative attacks, leading to severe financial crises.
Reduced Responsiveness to Domestic Conditions: A pegged currency regime limits a country’s ability to respond to domestic economic changes, such as inflation, unemployment, or economic downturns.
Fixed Exchange Rates in Modern Trading
In modern trading, understanding the dynamics of fixed currencies offers traders specific advantages and insights:
Predictability in Forex Pairs: Traders can anticipate less volatility in forex involving a fixed value, allowing for more stable long-term investment strategies.
Indicator of Economic Policies: The status and changes in a fixed rate potentially signal shifts in a country's monetary and fiscal policies, providing traders with crucial information for decision-making.
Trade and Investment Decisions: Understanding which countries have pegged rates can guide traders in making informed decisions about trade and investment opportunities.
List of Fixed Exchange Rate Currencies
As of 2023, several currencies operate under a fixed exchange rate system. Notable examples include:
Hong Kong dollar (HKD) - pegged to the US dollar.
United Arab Emirates dirham (AED) - pegged to the US dollar.
West African CFA franc (XOF) and Central African CFA franc (XAF) - both pegged to the euro.
Bahamian dollar (BSD) - pegged to the US dollar.
Danish krone - pegged to the euro.
The Bottom Line
In conclusion, grasping the nuances of fixed exchange rates is crucial for anyone involved in international finance. Whether weighing the pros and cons or observing their impact on modern trading, this knowledge is invaluable. For those looking to apply this understanding practically, opening an FXOpen account can be a strategic step, offering a platform to navigate and capitalise on the opportunities in the global financial markets.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
USDHKD Down.USDHKD Down.
Double Top.
Price flattening on top.
M5 is prevailing trend with no bias from top timeframes.
Divergence.
Taking Short for 5x.
USDHKD BUY AnalysisI've been following this chart for a while. After having an OVERSOLD signal in the 1D chart, I also received buy signals in the 4H chart and therefore I decided to report this position.
At this moment the position is not open yet, but if it follows the trend, as indicated in the graph (by the blue arrow), I will open the trade as soon as it reaches the indicated price (in the yellow circle).
Naturally, if it were to reverse course and therefore take the wrong path (red arrow), this trade will not open and will be cancelled.
USDHKD: Rejection on the 1D MA50 and LH trendline. Sell.USDHKD is on a neutral 1D technical outlook (RSI = 47.421, MACD = -0.002, ADX = 19.830) as it is approaching the end of a Descending Triangle pattern. Yesterday it got a double rejection on the 1D MA50 and the LH trendline.
A harmonic Descending Triangle broke down to the S1 level after after its third contact with the LH trendline. Consequently we trrat this as a sell opportunity (TP = 7.7940).
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USDHKD The wonderful wave trading of this pair.It has been almost 1 year since we published a long-term perspective on the USDHKD pair (chart below) based on a cyclical behavior and as you see it has worked wonderfully:
Basically the Sine Waves couldn't have mapped it better and have successfully projected the sharp fall straight after our article as well as the one that started in May (2023). Right now this Cycle has bottomed and we should again see it rise to the pivotal 7.8500 level. What we want to see after that is a series of Lower Highs on the 1D RSI and as usual that will be the signal to sell.
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USDHKDUsing DOw theory we see a major downtrend, keeping the stop loss at the last resistance/LH
and TP at last support. Sell Stop, two trades each at same entry one exit at TP1 one at TP2. R/R 2/3.
Cup & HandleFollowing USDHKD depicted a clear inverted Cup & Handle approach in trend that proved a Bear run thus shorting at a precise Entry Point and placed TP1 a bit below the potential depth of the cup.
Hong Kong Dollar Peg (short HKD, long USD)Hong Kong has been facing quite a lot of pressure from Mainland China, and a good portion of their higher networth population are sending assets abroad to diversify from Asia risk. The HKD is softly pegged to the USD and they've been maintaining this peg for 40 years. Their stock market is at a very key level of 20k HKD and could start to break down (the HKMA uses those assets as one of the collaterals on the balance sheet to maintain the peg). US govt bond yields have been rising and forcing HongKong yields to rise as well. Higher yields puts pressure on their stock market and on their real estate market (one of the most highly valued in the world).
The Hong Kong Monetary Authority (HKMA) will have to decide if they want to maintain the peg, prop up real estate prices or prop up stock prices. Usually governments take the inflation path to bail out on their obligations.
interesting take on the hong kong dollar peg:
www.youtube.com
www.realvision.com
www.realvision.com
USDHKD BearishAs the chart shows the divergence and then it prints consecutive LH and LL so we can predict a bearish trend and we use fib to determine entry
USDHKD Could this be the next Swiss Franc?The Swiss Franc used to be pegged to the Euro until 2015. The ECB went on a money printing spree with its own QE and the SNB could not sustain maintaining the peg. So it decided to remove the peg and the Swiss Franc strengthened against the Euro more than 20%. This caught a bunch of traders by surprise (mainly because the SNB said it was committed to maintaining the peg) and even collapsed the FXCM branch in the US. Now, will this happen to the HKD peg? Maybe. But the difference here is going long this pair will have you gain positive rollover and if the peg is removed, then price will likely appreciate. If price ranges, then you will be gaining around 1.77% a day, which is pretty decent (especially if utilizing margin. Be careful with using a large amount of margin). As this pair ranges and the FED keeps rates where they are at, with a standard lot, you'll be seeing around $4.85 a day. That is HKEX:1 ,770.25 a year and since the margin requirement for the HKD is around HKEX:10 ,000 for a standard lot, that is over a 17% increase (a little less because you will need more to add some buffer room or you'll get hit with a margin call). But if built correctly, this could be a nice play. I have an entry at the bottom of the band in order to get price at a good lvl. From here I can just hold.
Remember, these are just my thoughts and what I am doing. I could be wrong so conduct your own research and analysis. Have some good trading out there.
Hong Kong Dollar USD PegThe Hong Kong dollar is confined to an extremely tight trading range by the central bank. The authorities have been able to maintain this peg for many years. Right now the dollar is trading right at the top of the range. If the peg breaks it would be notable.
USDHKD is at its weekly administrative resistance levelHong Kong has adopted a fixed exchange rate regime with the US dollar since 1983, with a rate of 1 USD to 7.80 HKD (between 7.75 and 7.85 HKD per 1 USD since 2005). As a result, the only operational target of the monetary authority (HKMA) is the Hong Kong dollar exchange rate against the US dollar.
Looking at the USDHKD in the W chart, I have noticed that it is being traded on FTMO and MFF. As of today, 28.02.23, it is at its weekly administrative resistance level. This looks like a short opportunity.
