EUR/CHF Forecast Today - 19/07: Euro Bounces (Video & Chart)
Date
7/21/2024 9:52:04 AM
(MENAFN- Daily Forex)
In my daily Euro against Swiss Franc analysis, it's easy to see that we are at a major inflection point. We are hanging around the 200-day EMA, which of course captures a lot of attention, and quite frankly at this point in time, we look likely to form a little bit of a hammer. That's interesting because we plunged so violently during the Wednesday session and the ECB really didn't do anything during the session on its interest rate decision. Because of this, I think you have to look at this area through the prism of history, and it does look like it's an area that's been important more than once, as the 0.9650 level has been both supportive and resistant.
If we can break above the highs of the trading session on Thursday then I think very likely we are going to try to take back a lot of those losses from the previous session. Ultimately this is a market that I think given enough time probably takes off to the upside just due to interest rate differential although the euro doesn't necessarily produce the most outstanding returns it is better than the Swiss franc. Furthermore, both of these central banks have cut in the past.
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The Point of this Pair
Now it'll be interesting to see how the interplay continues. And keep in mind that the pair is highly sensitive to risk appetite. That's mainly because Europeans when pressed with risk aversion will quite often go into Switzerland and therefore it moves the pair lower. And of course, vice versa. The Swiss will invest in places like Austria or Germany, Belgium, perhaps when times are good. So, I'm watching this currency pair with great interest here because we are most certainly in an area where we could see a big move. Until then, I think you will be looking at smaller moves, but that is quite common for this pair overall.
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