FXstreet.com (Barcelona) - Sebastien Galy, Senior FX Strategist at Societe Generale recalls that King Orgetorix burnt his beloved Swiss lands in a forced migration away from Germanic tribal pressure.

However, he notes that things are far more civilised now, but the pressure comes from central banks and it is only option books that are burning as EURCHF explodes higher. He sees that the great portfolio outflows are yet to materialise boosting EURCHF. He is targeting an overshoot above 1.3000 as investors put on strategic shorts in CHF.

Galy comments that the sad historical reality is that King Orgetorix met a rising Caesar who decimated the Helvetians and sent them packing home to face the Germanic tribes. He notes that the question for the futures is therefore, and asks "what will be considered safe? Cash costs with negative real yields, the back end of yield curves in the US is increasingly at risk, equities are by definition risky and gold is not necessarily a hedge when the Fed is less clearly on the expansionary path." Galy feels that the answer in FX seems to be rising uncertainty translating into higher FX vols. This uncertainty is likely to percolate across asset classes.

You May Also Like

Related Forex Analysis
  1. Forex News

    Watch Risks on these Key Currency Pairs Given Volatility Risk Ahead

  2. Forex News

    Euro Set for Rocky Week as Greece Stares into the Abyss

  3. Forex News

    EUR/USD Set for Volatility as Greek Deadline Looms Large

  4. Forex News

    EUR/USD at Risk as Positioning Thins, Greece and FOMC Share Limelight

  5. Forex News

    EUR/USD at Risk as Significant Short Covering Has Passed

Trading Center

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!