EUR/CHF: rare and peculiar

EUR/CHF: rare and peculiar

2022-12-20 • Updated

EURCHF is a rare cross pair that is nonetheless very interesting both from the technical and fundamental point of view. Let’s throw a strategic look at it to see what we may expect in the nearest future.

Not going too far back into the past, we can distinguish three periods of performance in EUR/CHF.

History: three periods

The first period (marked “1”) is the time when the Swiss franc was pegged to the euro. The price was flat at 1.2050 most of the time. A plunge like never before marks the end of this period – Swiss financial authorities decided to unpeg the franc from the euro.

The second period (marked “2”) roughly corresponds to 2015-2018. During those years, EUR/CHF has been mostly rising. It peaked exactly at 1.2050 and bounced downwards.

The third period starts with the bounce from the strategic resistance of 1.2050 and goes into the present moment. EUR/CHF basically undid all the gains it did in the second period – now, it is roughly where it was shortly after the drop when the unpeg took place.

Fundamentals: support at all cost

So is it going below the support of 1.0520? Unlikely – the Swiss economy depends on European buying. Expensive CHF will demotivate the outside Europeans to buy what Switzerland has to offer – that’s why the Swiss National Bank has been so preoccupied lately to not let CHF appreciate too much. “Too much” means EUR/CHF going below 1.0520: we can see this strategic support as solid ground. For this reason, in the mid-term, EUR/CHF may approach and even dip below this mark, but in the long term the possibility that it will go significantly lower is not that big. For this reason, expect a strategic bounce upwards, which may have already started. In the end, the channel 1.0520 – 1.2000 may well turn out to be a multiyear sideways movement zone where the SNB is trying to keep the CHF.

1.png

                                                                                                    LOG IN

Similar

Oil Market Outlook
Oil Market Outlook

Oil prices rebounded slightly on Friday but are still expected to show losses for the week due to concerns about slowing growth in the US and China. US crude futures rose 2.7% to $70.41 per barrel, while the Brent contract increased by 2.5% to $74.33 per barrel.

Latest news

Gold and the Majors ahead of the NFP
Gold and the Majors ahead of the NFP

Let's dive into the latest developments shaping the global economic landscape. Good news first: the threat of an unprecedented US debt crisis has receded, as US lawmakers passed a bill to raise the debt ceiling and avoid a catastrophic default. Phew! But don't pop the champagne just yet, because storm clouds are still looming. High inflation, rising interest rates, and sluggish growth are challenges that have yet to disappear.

The Oil Market in the Month of June
The Oil Market in the Month of June

Thanks to the incredible advancements in horizontal drilling and fracking technology, the United States has experienced a mind-blowing shale revolution. They've become the heavyweight champion of crude oil production, leaving Saudi Arabia and Russia in the dust. They even turned the tables and became net exporters of refined petroleum products in 2011.

Gold’s Next Move Could Be Huge!
Gold’s Next Move Could Be Huge!

Let's dive into the world of gold. Currently, the price of gold, represented by XAUUSD, is stuck in indecision, hovering around the $1,975 mark. The market is anxiously awaiting two important factors: the release of the Federal Reserve's meeting minutes and the extension of the US debt ceiling.

Deposit with your local payment systems

Feel the Team Spirit

Data collection notice

FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.

Callback

A manager will call you shortly.

Change number

Your request is accepted.

A manager will call you shortly.

Next callback request for this phone number
will be available in

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later

Don’t waste your time – keep track of how NFP affects the US dollar and profit!

Beginner Forex book

Beginner Forex book will guide you through the world of trading.

Beginner Forex book

The most important things to start trading
Enter your e-mail, and we will send you a free Beginner Forex book

Thank you!

We've emailed a special link to your e-mail.
Click the link to confirm your address and get Beginner Forex book for free.

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera