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EURO / HUNGARIAN FORINT REFERENCE RATE

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EURHUF - Buy wave soon, buy the dip or the Slow Stoch signalAfter breaking below prev. range bottom, EURHUF started a new consolidation phase within the daily Kumo. Since daily Slow Stoch is oversold and will be turning to bullish soon, I recommend to close all shorts and start looking to accumulate small contra longs in 306-307,50. (stops to be placed below 305). I expect a wave up to 310-311 levels next. Maybe it can go to 312 as well, but the Kumo is thick, and as I wrote before in the last post, the Ichimoku setup has changed on the daily, so I do not expect the rally to last for long.
Long
by Kumowizard
EURHUF - Some interesting changes in technicals!Despite fundamentally HUF is the weakest chain among EM ccys, technically we have interesting change now which we have to pay attention to! Daily: DMI crossed bearish, MACD has had massive negative divergence for some time now, Tenkan/Kijun printed a bearish cross (weak sell signal as happened above the Kumo), the higher lows of the chanel (which is the same as the 4 Hrs uptrend line) is broken too, and price started to penetrate the Kumo. Future Kumo started to point down. The horizontal 308 support is still there, and also it is oversold on 4 Hrs (Stoch turning up). Trading is always about the probabilities, so let's see what each side can expect. Bulls: if you want to go Long from 308-308,50, well it may be ok, but Place your stops tight, 307,50-307,75. Another Long strategy can be to wait and see if price comes lower into the Kumo retesting 305 levels, and in line with daily Slow Stoch turning up, swing buy only from that level, with tgt 310-311, keeping in mind that price will start a Kumo consolidation. Bears: Wait for a bounce back to 311,50-312, and look for shorts setup only there My feelings: if price breaks below 308, that means Chikou Span will drop below price candles too. From that point the range will be gone, and price very likely enter a new range 305-310 and starts consolidation in the Kumo. Since the Kumo is thick enough I don't think it can quickly drop to 303 trend support. Anyway, playing bullish trades, betting on the current range to stay, has a lot more risk from now, so trade it only with half units. My bias somehow turned a bit more bearish on this cross (i.e. HUF to perform better). Sure enough, this cross was never easy to trade, but from now it will be even more difficult. All in all, I decrease my 100 % bullish bias, that I have kept since 297-300 levels.
by Kumowizard
EURHUF - Has it become a managed ccy?Long term I am still very bullish for EURHUF, but hey, look at this range which still persist! Who is on the top? For me it looks like policy makers do not want to see it a lot higher than 314-315. General election is due on 6th/April, so I would not be surprised if there have been some "silent intervention" behind the curtain. (btw as far as I know NBH ccy reserves decresed recently by a few hundred million EUR). ... but this is all a guessing ;-). Anyway it is good for a short now with initial tgt 310. Be quick, as this one is always moving super fast. As I called your attention in my previous pots regarding EURHUF, NBH has still a lot of reserves to keep volatility lower, while they are still incredibly desperate to cut benchmark rate as low as possible (ZIRP? :-D). However long term I think HUF will become under real pressure, and will suffer same way as TRY. Btw, I am thinking a lot about how we could make a good strategic short on huf, and recently I started to examine TRYHUF. I will try to post stg on this later, as this issue will be very very important for professional fund managers (real money and hedge funds as well) very soon as Hungary is doing an extremely dangerous monetary policy, while it has weak fiscal policy and a huge debt still. Basically NBH is going against the EM rate cycle that has already started (hikes everywhere). This will have consequences. But as I said, for now SELL small and buy double size at the range bottom :-). This has been the good risk reward trade for weeks now.
Short
by Kumowizard