EUR/CHF Plunges Amid Swiss GDP Release

FXOpen

The Euro slid down against its Swiss peer on Wednesday, taking the price to less than 1.2035, following the release of Swiss GDP Figure. This is the first time the Euro depreciated after the rejection of Swiss gold proposal. However, the price of the pair is floored firmly at 1.2000 by the Swiss National Bank.

Technical analysis

As of this writing, the pair is being traded around 1.2034.  Opened at 1.2036, the pair found some buyers during the early hours of Asian session taking the price up to 1.2041. But then the sellers jumped in and pulled the price back to 1.2034. On the upside, the pair may face a hurdle around 1.2057, the three week high and the confluence of 50-Day SMA and 38.2% fib level, as demonstrated in the following chart. On the downside, the 1.2000 floor will continue to act as a major support.

eurchf

As demonstrated through the trend line in the above chart, the pair underwent a bullish breakout. The overall bias however is bearish because of lower highs on the daily chart. The bias will remain bearish unless the resistance around 1.2115 remains intact.

Retail Sales

The Eurozone retail sales remained at 1.4% this October, more than that of 0.6% in the same month of the previous year, says the average forecast of different economists. As an indicator of economic growth, a high reading is considered to have positive impact on Euro and vice versa. Therefore, a better than expected figure may strengthen the bullish momentum in the price of EUR/CHF.

Gross Domestic Product

Exceeding the expectations 1.4%, the Swiss GDP for the third quarter remained at 1.9%, higher than 1.6% in the same quarter of previous year. Generally speaking, a high reading is considered positive for the Swiss franc. Therefore a better actual outcome spurred renewed selling pressure in the price of EUR/CHF.

Trade Idea

Considering the overall fundamental and technical outlook, buying the pair around the 1.2025 support area appears to be a good strategy in short to medium term, the trade should however be stopped out on a daily closing below the 1.2000 floor level.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Forex Analysis

EUR/USD Exchange Rate Has Fallen Below 1.08 Level In the Spotlight: US Inflation and GDP Data GBP/JPY at Highest Level in Over 15 Years The Dollar Resumes Growth After a Corrective Pullback Market Analysis: EUR/USD Slips as USD/CHF Targets Upside Break

Latest articles

Indices

Nasdaq Index Shows Uncertainty Ahead of PCE Release

The main event of the week is the release of the Personal Consumption Expenditures (PCE) index, which the Federal Reserve particularly focuses on when assessing inflation in the US. The release is scheduled for Friday at 15:30 GMT+3.

Forex Analysis

EUR/USD Exchange Rate Has Fallen Below 1.08 Level

As the EUR/USD chart today shows, yesterday the rate dropped by 0.46% – the most significant strengthening of the US dollar against the euro in one day this month. Moreover, the rate fell below the psychological mark of 1.

Forex Analysis

In the Spotlight: US Inflation and GDP Data

In the final trading sessions of May, leading currencies have been in a downward trend against the dollar. For instance, the pound/dollar pair lost over 100 pips in a single day, euro sellers in the EUR/USD pair are

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.