CHF/JPY Forecast Today 05/7: CHF Shows Strength (Video)
(MENAFN- Daily Forex)
The Swiss franc initially pulled back just a bit against the Japanese yen during the trading session on Thursday, but then turned around to show signs of strength All things being equal, this is a market that continues to see a lot of buyers on dips as we are hanging around the 179 yen level. The market still sees plenty of support underneath.
I think you will continue to see the Swiss franc find plenty of buyers. It's not necessarily that the Swiss franc is going to be strong, but it's more about the Japanese yen losing strength on an almost daily basis. The debt in Japan is such that you cannot have higher interest rates because they can't get these debts paid off. With that being said, I think that although the Swiss franc has recently seen an interest rate cut, the reality is you still get paid to hang on to this market.
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If We Fall From Here..
If we do fall from here, then we could drop as low as the 50 day EMA near the 175 yen level, which of course is an area that was roughly where the Bank of Japan intervened, albeit not necessarily against the Swiss franc, just against the US dollar, which had a major knock-on effect over here.
All things being equal, I do think that we try to get to the 180 yen level, but the question is, how long does it take? Keep in mind, this CHF/JPY pair does tend to be very slow moving, and you can see that we are a little stretched. So I do think we will continue to see more or less a buy on the dip mentality but as far as the next impulse hire is concerned, it may take some time to show up. However, with a lot of patience, this pair can pay off quite nicely.
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