Introduction:
These past couple of weeks have been quite a ride for anyone involved in the forex markets. To an extent, it showcased the necessity of allying our technical analysis with a more proper assessment of the political landscape. While a stable market provides us with reasonably well-determined supply and demand zones for each currency, facilitating our job in forecasting zones of interest, the immediacy of moves caused by governmental agents' announcements sometimes blow it out of the water.
USDCHF is somewhat of a tricky pair to engage in during these particular times. While the Swiss National Bank actively maneuvers the CHF to facilitate Switzerland's export businesses, the fact that its currency is backed by gold is highly sought up when risk sentiment is off the markets. It acts as a Safe Haven for investors unwilling to expose themselves to the hazards of uncertainty.
In the charts we see a wedge-like formation tightening at every low, calling for a trendline adjustment oftenly. While a bearish case could be made here, it would be reckless to hold such a position for too long, since the markets are convoluted and USDCHF short swaps are huge. A long case is perfectly understandable as well, since higher lows are narrowing. However, USDCHF hasn't broken the 1.03 level in almost 10 years.
We only trade what we believe holds the best risk-reward ratio available, and right now we have no open positions on USDCHF. Those trend-lines are key, though, and whenever price interacts with any of them, we will take action.
Risks Involved and Key Events to Tune Yourselves to:
The markets have been openly ignoring most CHF news, while keeping a close eye on the standard USD releases. A trade-war conclusion could reinstate a risk sentiment to the market and that would make for a perfect long. If it escalates further, though, we will trade the other direction.
Side-notes:
Please leave your comments below to inspire us to continue our work and don't forget to follow us! Feel free to send us a direct message with any doubts you might have and experience a great trading session!
These past couple of weeks have been quite a ride for anyone involved in the forex markets. To an extent, it showcased the necessity of allying our technical analysis with a more proper assessment of the political landscape. While a stable market provides us with reasonably well-determined supply and demand zones for each currency, facilitating our job in forecasting zones of interest, the immediacy of moves caused by governmental agents' announcements sometimes blow it out of the water.
USDCHF is somewhat of a tricky pair to engage in during these particular times. While the Swiss National Bank actively maneuvers the CHF to facilitate Switzerland's export businesses, the fact that its currency is backed by gold is highly sought up when risk sentiment is off the markets. It acts as a Safe Haven for investors unwilling to expose themselves to the hazards of uncertainty.
In the charts we see a wedge-like formation tightening at every low, calling for a trendline adjustment oftenly. While a bearish case could be made here, it would be reckless to hold such a position for too long, since the markets are convoluted and USDCHF short swaps are huge. A long case is perfectly understandable as well, since higher lows are narrowing. However, USDCHF hasn't broken the 1.03 level in almost 10 years.
We only trade what we believe holds the best risk-reward ratio available, and right now we have no open positions on USDCHF. Those trend-lines are key, though, and whenever price interacts with any of them, we will take action.
Risks Involved and Key Events to Tune Yourselves to:
The markets have been openly ignoring most CHF news, while keeping a close eye on the standard USD releases. A trade-war conclusion could reinstate a risk sentiment to the market and that would make for a perfect long. If it escalates further, though, we will trade the other direction.
Side-notes:
Please leave your comments below to inspire us to continue our work and don't forget to follow us! Feel free to send us a direct message with any doubts you might have and experience a great trading session!
