USD/CHF Forecast: Continues to Drift

• The USD/CHF has fallen a bit during the trading session on Tuesday, as we are hanging around the 0.93 CHF level.
• When you look at the chart, you can see the clear, we are sitting in an area that has had a lot of demand in the past, it is probably worth noting that lately things have been negative, but they have been a grind.
• On the other hand, if we continue to break down below the 0.92 CHF level, then the market could go quite drastically to the downside, dropping another couple of handles.

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Alternatively, we turn around and take on that 0.94 CHF level, then we will threaten the 50-Day EMA, perhaps opening the possibility of a move to the 200-Day EMA at the 0.9567 level. Clearing that allows the US dollar to reach parity with the Swiss franc again, which is something that would not surprise me considering just how “risk off” the market could get rather quickly. Keep in mind that the Swiss franc is a safe currency, but at the end of the day, Switzerland is far too exposed to the European Union.

Be Patient

I do also want to point out that we have a little bit of a falling wedge working, so if it does take off to the upside that might be interesting as well. It would measure for a move to that 200-Day EMA. If we break down, then it will just be an anti-US dollar move across the board, and it probably won’t be just here. The next several days will be very quiet more likely than not since we are between Christmas and New Year’s Day.

Either way, keep in mind that this pair does tend to move rather slowly, so you will need a certain amount of patience if you do take on the trade. With that, you should also position size accordingly, since the lack of volume could have this market moving quite rapidly based upon some type of surprise announcement. Keep in mind that this market really has nothing to push it one way or the other, other than the fact that we are sitting on top of the support, and we have nowhere to be.

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