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MENAFN- Daily Forex)
The Aussie dollar continues to see a lot of noise, as the markets continue to see a lot of noise. The RBA just hiked rates, raising them by 25 basis points. At this point, the market is likely to continue to favor the upside here.
The Australian dollar initially rallied against the Swiss franc during early trading on Tuesday but gave back the gains to show signs of hesitation. This is a situation where traders continue to see a lot of noisy trading, with the 0.58 level offering a bit of support. The 0.58 level is a large, round, psychologically significant figure and an area that has been important a couple of times in the recent past. The 0.5850 level above is significant resistance and did offer that resistance early on Tuesday.
Top Regulated Brokers1 Get Started 74% of retail CFD accounts lose money Nonetheless, this is a pair that still offers a massive interest rate differentialEURUSD Chart by TradingView
Especially as the RBA just hiked rates another 25 basis points, this widens the gap between Australia and Switzerland. It is worth noting that the Swiss National Bank has a fanatical need for exports to keep interest rates at zero, and the SNB will do whatever it takes to keep that the case. They do not like the expensive Swiss franc, which has been expensive for the last couple of years. In fact, it is a common complaint of the members of the SNB.
Really, at this point in time, they are the least likely to raise rates. So, it does make sense that you continue to see the Swiss franc lose strength, especially against some of the stronger and more hawkish central banks, like Australia. This is a market that I am comfortable holding over the longer term for traders, as they get paid every day via swap here. In general, the Swiss franc is one of my favorite currencies to short, despite there is a certain amount of noise from time to time.
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