However, it keeps a close eye on it and, judging by the price action, it looks poised to try again. This is especially important because this week, the Bank of England (BOE) is set to deliver its monetary policy outlook and decision.
Swiss Manufacturing PMI Failed to Trigger Weakness in CHF
As usual, the NFP week is filled with PMIs data from all over the world. If the Eurozone or the American PMIs both beat expectations, the Swiss PMI did not.
Not only that it did not meet expectations, but it came out below the 50 level. In other words, it signals still a contractionary sector – 49.2 on expected 50.0.
But, despite weaker than expected data out of Switzerland and stronger one out of the United Kingdom, the GBPCHF cross fails to catch a bid tone. Technical levels still matter, as well as the CHF safe-haven nature.
GBPCHF Technical Outlook
The technical picture for the cross remains unchanged. After a strong rejection at the lows in March, the cross met 1.20, and all bullish activity stopped.
However, it keeps building energy to pop higher, and the aim here is to catch the upcoming bullish trend. To do that, a trader must wait for the price to break first, and then jump on the long side.
As such, the trading plan requires the price to move back above the 1.20 and make a new marginal higher high. Effectively, it means placing a pending buy stop order at 1.2050. Or simply wait for the price to reach that level and go long at the market. Next, place a stop-loss order two hundred pips below so to avoid a new slip back below the 1.20. Finally, target 1:3 risk-reward ratio as the measured move for the potential continuation pattern is more than enough to deliver such return.