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CHF: Swiss Franc is in demand again

At the Forex currency market Swiss Franc rate continues to grow after several days of slight correction from historical highs; demand in safe currencies increases amid resumption of unrest in the countries of the Middle East and North Africa

Forex forecast: MACD indicator is in the negative area for the pair USD/CHF and continues to go down, confirming a previous sell signal for the pair. Stochastic oscillator has come out of oversold zone today and is giving a pair buy signal.

Forex recommendations: off the market.

Feasible event scenario at Forex: in case of breakdown at the level of 0.9225 the pair will go to 0.9180 and 0.9140. if the level of 0.9300 is exceeded, the pair will go to 0.9330 and 0.9360/70.

On Thursday, 3 March, the data on retail sales for January is going to be made public in the market.

The data released yesterday did not make strong impression on the Franc, although it was very favourable (real GDP in QIV: +0.9% q/q (+3.1% y/y) against the forecast of growth by 0.5% q/q (+2.8% y/y); PMI SVME rose to 63.5 points in February against the forecast of 60.5 points). Therefore, Swiss economy is strong and continues to progress along the recovery path.

Last week’s indicators showed that employment rate in Switzerland declined to the level of 4.085 billion in QIV against expectations of growth to 4.086 billion; however Franc ignored this information. The data released earlier showed that indicator of consumption UBS in Switzerland fell to the level of 1.676 points (-0.15 points) in January amid decreasing sales in retail sector due to the low demand for new cars. However the indicator still remains above the key level of 1.5, which ensures favorable prospects.

In addition, import prices in Switzerland increased by 9.8% y/y in January; export rose by 15.5% y/y.

It is the factor of trade balance (index rose to the level of 1.96 billion euro in January against the growth to 1.26 billion euro earlier) that helps the CHF to be considered stable currency, since the country does not require external borrowings.

It is possible that the Franc will reach its highs again before the end of this week.

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