- The British pound has fallen a bit during the trading session on Thursday against the Swiss franc, but it looks like it continues to see a little bit of support just below, so it is worth noting that this is a market that pays swap at the end of the day, and therefore we could start to see a little bit of a basing pattern form in this region.
- I’m not ready to throw a ton of money into this market quite yet, but I already have a long position that I’m perfectly comfortable with but have been long of this pair for months.
Technical Analysis
Technical analysis dictates that there should be a lot of support near the 1.13 level, as it is an area that people had paid close attention to more than once. The 200-Day EMA underneath continues to offer support as well, as it is near the 1.1240 region. As long as we can stay above there, then I think it comes down to the opportunities that present themselves via either a dip, or a continuation of momentum to the upside if we do in fact get it.
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The 1.15 level above is a significant resistance barrier, but between here and there we have the 50-Day exponential moving average offering a significant amount of resistance, so if we can break above the 1.15 level, then it’s possible that we could go looking to the 1.1650 level, the recent swing high. Anything above there then becomes more or less a “buy-and-hold” type of situation.
Remember, the Swiss National Bank recently cut interest rates, and is likely to continue to see reasons for loosening monetary policy. At this point, there will be a lot more focus paid to the Bank of England, because they have not cut yet, and if they do decide to stand pat, that could have a major positive influence on the British pound overall, especially against week currencies like the Swiss franc. I still like the GBP/CHF pair to the one side, but I also recognize that there will be a lot of volatility.
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