CHF: The Swiss Franc Shows Signs of Strength

CHF: The Swiss Franc Shows Signs of Strength

Diperbarui • 2024-01-17

Swiss National Bank (SNB) President Thomas Jordan has expressed that the recent appreciation of the Swiss franc has reached a point where it could significantly influence the inflation outlook. This observation indicates apprehensions regarding the strength of the Swiss franc and its potential consequences for inflation dynamics. The SNB has a track record of intervening in currency markets to prevent an excessive rise in the Swiss franc, as a robust franc can negatively impact the nation's export-focused economy and contribute to deflationary trends. These remarks were made during an interview on Bloomberg Television at the World Economic Forum's annual meeting in Davos, Switzerland.

USDCHF - H4 Timeframe

USDCHFDaily-1701.png

We recently saw a surge in the price action on USDCHF as a result of the rejection from the demand zone on the weekly timeframe. However, since the overall direction of the market is bearish, I see the likelihood of a bearish continuation from the highlighted area of supply as shown on the chart. The 50-period moving average can be considered a confluence in support of the bearish sentiment.

Analyst’s Expectations: 

Direction: Bearish

Target: 0.85545

Invalidation: 0.87156

CADCHF - H4 Timeframe

CADCHFDaily-1701.png

CADCHF recently made a bounce which I consider to be an attempt to retest the supply zone, and possibly the 50-period moving average as well. The convergence of the two resistance trendlines at the supply zone, and the bearish array of the moving averages can be considered a further confirmation of the bearish sentiment.

Analyst’s Expectations: 

Direction: Bearish

Target: 0.63608

Invalidation: 0.64810

EURCHF - H4 Timeframe

EURCHFDaily-1701bb.png

The price action confirmation on EURCHF is not exactly my best preferred, but I believe it should fall in line with the other two analyses I showed earlier. In the case of EURCHF though, I expect to see a reaction from this supply zone as I have marked out on the chart.

Analyst’s Expectations: 

Direction: Bearish

Target: 0.93174

Invalidation: 0.94502

CONCLUSION

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