The Swiss Franc appreciated quite strongly during the Monday session as traders sold off the Dollar against almost all currencies worldwide. The move might not have been so much a nod to the Franc , rather a snub to the Dollar. It should be noted however, that the pair only fell to support, and did not break below the important psychological number of 0.90.
The Swiss National Bank has been actively working against the appreciation of the Franc, especially against the Euro. With this in mind, we are not willing to buy it. In fact, we see this move as a potential set up to go long this pair, as the US Dollar is the ultimate safe haven trade, and there is plenty out there that could go wrong presently. Until we break below the 0.88 level, we feel this pair should still continue to climb as traders dare not risk a fight with the Swiss National Bank.
Any supportive candles at the 0.90 level would be very interesting to us, and we wouldn’t hesitate to buy them, and even as a long-term trade as the SNB should continue to work against its currency for the next several months.
Written by FX Empire