USDCHF Gains As SNB’s Jordan Puts Swiss Franc On the Back Foot

[vc_row][vc_column][vc_column_text]The USDCHF edged higher today after Swiss National Bank (SNB) Chairman Thomas Jordan said that the SNB had enough room to cut interest rates further if the need arose.

According to Jordan, the “Swiss franc is highly valued… will continue the policy as necessary, can continue enlarging balance sheet so long as benefits outweigh costs.” The SNB Chief hinted that the bank was comfortable with the current interest rate of -0.75%, but would not hesitate to send this rate lower if it had to, also stressing that the bank had no intention to buy or sell gold. However, he also left this door open, saying that the decision not to trade gold could “change over time”.

As a result of these comments, the Swiss Franc was sold off on the day, allowing the USDCHF to gain 0.49% on the day and is currently trading at 0.96993.[/vc_column_text][vc_column_text css=”.vc_custom_1585659276156{background-color: #f9f9f9 !important;}”]

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Technical Outlook for USDCHF

The pair had hit intraday highs of 0.97284 before retreating to its present levels. The Swiss Franc had been the most demanded currency for last week after the CFTC positioning report showed an increase to net longs on the Swiss Franc to 4-year highs.

However, the price action of the USDCHF continues to trade within the borders of the symmetrical triangle on the daily chart. Today’s comments by the SNB Chairman allowed the pair to respect these borders with an uptick from the lower triangle border. This uptick met resistance at the 0.97139 resistance level, just as this morning’s push came off the 0.96535 support line. These represent the barriers to beat. A breakdown of the triangle and the 0.96535 support level opens the door for the pair to aim for 0.96274, with 0.95496 and 0.94324 having potential to become additional support areas if the price decline below the triangle gains momentum.

On the flip side, weakening sentiment on the CHF could allow the pair to break above 0.97139, which takes the pair out of the triangle and also towards the 0.97793 and 0.98116 price levels. 0.98652 remains a possible resistance target if the pair’s advance carries momentum.[/vc_column_text][vc_column_text css=”.vc_custom_1565176883833{background-color: #f9f9f9 !important;}”]

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[/vc_column_text][vc_single_image image=”47795″ img_size=”full” add_caption=”yes” alignment=”center” onclick=”link_image” title=”USDCHF Daily Chart”][vc_column_text]More content

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