- You can see that the euro initially fell a bit during the trading session on Thursday, mainly in reaction to the impending rate cut coming out of the European Central Bank.
- Ultimately, after cutting that rate, they didn't sound as sure as I think a lot of people anticipated they would, and we have seen the 200 day EMA hold up in this pair.
- At this point, I do think that it is probably only a matter of time before we start to rally again.
- Perhaps trying to get to the 50 day EMA above at the 0.9770 region. After that, then you have the possibility of a move to the 0.99 level.
The 200-Day EMA
If we were to break down below the 200 day EMA, it could open up a move down to the 0.96 level. But it is easy to see on this chart that we are overly sold off at the moment, and being oversold typically will attract a certain amount of value hunting. Furthermore, the Swiss National Bank is likely to be very loose with its monetary policy going forward.
Top Regulated Brokers
Therefore, I think you've got a situation where it comes back to betting against the Swiss franc overall in this environment. I have no interest in shorting this EUR/CHF currency pair, at least not right now. I do think that you will probably have the probable move to the upside that you can take advantage of for a bigger move.
I do believe given enough time, we could reach the parity level, but that might be a situation for later this summer, maybe not necessarily something that we see in the short term. Remember that this pair does tend to be very slow moving over the longer term, so you need to be cognizant of the fact that you might be waiting a while to see some type of serious move to the upside. However, I have no interest in shorting the market at the moment.
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