Technical & Trade View
USDCHF
Trade View
Bias: Bullish Above Bearish below .9660
Technicals
Primary resistance is .9660 watch for bearish reversal patterns here
Primary pattern objective is .9300
Acceptance below .9440 next pattern confirmation
Acceptance above .9700 opens a test of .9840
20 Day VWAP bearish , 5 Day VWAP bullish
Options Expiries for today’s New York cut USD/CHF: 0.9525 (1.0BN)
Institutional Insights
Analysts at Credit Agricole note ‘Heightened concerns over Europe’s energy outlook going into the winter have spurred sustained safe-haven bids into the CHF whose appreciation was temporarily halted by a neutral SNB. Consolidation could still ensue, as Switzerland’s sounder stance makes the CHF a more compelling alternative among European currencies’, while the ‘ The USD has been seen as the key beneficiary of the unfolding global economic slowdown: (1) the US economy is more resilient than its European and Asian counterparts; (2) the Fed has emerged as one of the more hawkish G10 central banks in a boost to the USD’s real rate appeal; while (3) risk-averse investors continue to seek refuge in high-yielding USD cash. We expect the USD to peak only in Q123 as it remains supported by its status as a high-yielding, safe-haven currency. The fact that the USD is overbought and overvalued also means that the pace of any additional gains could slow down in the next 3-6M, however. Further out, depending on the severity of the global downturn, the USD should cede some ground vs other safe havens like the JPY and CHF –under a global ‘hard landing’
USDCHF
Trade View
Bias: Bullish Above Bearish below .9660
Technicals
Primary resistance is .9660 watch for bearish reversal patterns here
Primary pattern objective is .9300
Acceptance below .9440 next pattern confirmation
Acceptance above .9700 opens a test of .9840
20 Day VWAP bearish , 5 Day VWAP bullish
Options Expiries for today’s New York cut USD/CHF: 0.9525 (1.0BN)
Institutional Insights
Analysts at Credit Agricole note ‘Heightened concerns over Europe’s energy outlook going into the winter have spurred sustained safe-haven bids into the CHF whose appreciation was temporarily halted by a neutral SNB. Consolidation could still ensue, as Switzerland’s sounder stance makes the CHF a more compelling alternative among European currencies’, while the ‘ The USD has been seen as the key beneficiary of the unfolding global economic slowdown: (1) the US economy is more resilient than its European and Asian counterparts; (2) the Fed has emerged as one of the more hawkish G10 central banks in a boost to the USD’s real rate appeal; while (3) risk-averse investors continue to seek refuge in high-yielding USD cash. We expect the USD to peak only in Q123 as it remains supported by its status as a high-yielding, safe-haven currency. The fact that the USD is overbought and overvalued also means that the pace of any additional gains could slow down in the next 3-6M, however. Further out, depending on the severity of the global downturn, the USD should cede some ground vs other safe havens like the JPY and CHF –under a global ‘hard landing’
This analysis is provided as general market commentary and does not constitute investment advice. Past performance is not indicative of future results