USD/CHF collapsed 140-pips this week; Risk-off in control

Jose Ricaurte Jaen Analista independiente

Currently, USD/CHF is trading at 0.9970, down -0.83% or (83)-pips on the day, having posted a daily high at 1.0056 and low at 0.9968.

On the US economic docket, the saga continued during the anticipated NA trading session as Initial Jobless Claims clocked 239K 'a better than expected' figure against 245K consensus and slightly similar to 234K previous. Furthermore, Building Permits Change made an interesting statement at 4.6% from previously revised figure 1.3%.

However, 'decent' figures were not sufficed to boost the US dollar to new highs and the American dollar vs. Swiss franc accumulated as of writing a total weekly loss close to 140-pips. Hence, most news released have been priced in as market participants adjust positions towards the increased probability of a rate hike in March.

US as Switzerland's 2nd biggest trade partner

"Bilateral economic relations between Switzerland and the United States are strong not only in terms of investments but also when it comes to trade relations: while Switzerland exports goods and services valued at $52 billion to the U.S., Americans export $51 billion worth of goods and services to Switzerland," as Marketwired reported.

As developed countries seem to 'pitch' their value to the new US administration, one question arises; Is the US the most relevant market for wholesale, retail, and services in the year 2017?

Market wrap: US stocks and yields down - Westpac

Historical data available for traders and investors indicates during the last 7-weeks that USD/CHF pair had the best trading day at +0.80% (Jan.6) or 81-pips, and the worst at -1.05% (Jan.5) or (105)-pips.

Technical levels to watch

In terms of technical levels, upside barriers are aligned at 1.0102 (50-DMA), then at 1.0219 (high Jan.5) and above that at 1.0320 (high Dec.28). While supports are aligned at 1.0005 (100-DMA) - this level is gone, later at 0.9880 (200-DMA) and finally below that at 0.9734 (low Nov.8).

On the long-term view, upside barriers are aligned at 1.0101 (short-term 50.0% Fib) - false breakout; bearish pin bar - and above that level at 1.0158 (short-term 61.8% Fib). While supports are aligned at 0.9974 (short-term 23.6% Fib), later at 0.9931 (long-term 50.0% Fib) and finally bellow at 0.9903 (low Feb.5).

EUR/USD analysis: holding on to gains, despite another round of solid US data

Author

Jose Ricaurte Jaen

Analista independiente

Born in Colón (Panamá). Over the last years, he has been designing currency algorithms for the retail industry.

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