The EUR/CHF pair fell significantly during the Wednesday session, breaking slightly below the 1.09 handle. This area has been rather supportive lately, and we have bounced from it every time we have fallen towards it. However, you have to keep in mind that there is a significant amount of support just below this area as well, so at this point time I am not overly concerned about the uptrend. Because of this, I think that a buying opportunity will present itself, but the fact that we closed at the very lows of the candle on Wednesday suggests that we are going to go a little bit lower.
Nonetheless, I look at this is simply offering the Euro at a better price. Think of it as the currency going on sale, and that you are buying it at a better price buying simply waiting. That’s essentially what a lot of currency trading is about, waiting.
Swiss National Bank
The Swiss National Bank has recently released documents and on its suggesting that they have been involved in the Forex markets again. This is most certainly in the EUR/CHF pair, as it should the holdings of Euros being much larger than previously. With that being the case, I feel that this market will have a bit of an underlying pressure to the upside anyway, so I am essentially “buy only” when it comes to this market.
With that being the case, I look at every pullback as a potential buying opportunity, and I will treat them as such. I also recognize that the 1.10 level above is resistance though, so we will need to break above there for a longer-term move. I think that is coming, but it is going to take a bit of momentum building as it is a large, round, psychologically significant number. Once we break above there though, I don’t see any reason why we don’t continue to go higher, probably all the way back to the 1.20 level again.
