CHF: Swiss Franc still fails to work out general trading idea
At the Forex currency market Swiss Franc rate is traded downward on Friday, which, however does not exclude the possibility of growth in the nearest future. Thus, the pair USD/CHF is missing general and integrated trading idea.
Forex forecast: MACD indicator is in the negative area for the pair USD/CHF; it slowed down its decline and started upward reversal, giving a pair buy signal. Stochastic Oscillator has reached overbought zone and is giving a similar signal.
Forex recommendations: in case of breakdown at the level of 0.8890 the pair USD/CHF will go to 0.8915 and 0.8930. If upward breakdown does not take place the pair will consolidate close to the current levels.
It became known earlier that consumer confidence index in Switzerland amounted to 1 point in QI, as per SECO estimates, against the growth by 10 points in QIV. Franc has ignored this statistics.
Earlier it was made public that unemployment rate in Switzerland fell to 3.1% in April against the previous level of 3.3%. It is a positive indication for the economy. The data released earlier showed, that real retail sales in Switzerland decreased by 0.2% in March against the growth by 1.8% in February. In addition index SVME – PMI in Switzerland fell to 58.4 points in April against the previous level of 59.3 points. In addition statistics released earlier showed that consumption indicator UBS in Switzerland rose to 1.660 points in March against the revised level of 1.453 points in February; while volume of export in Switzerland fell by 4.8% m/m in March against the level of +3.6% m/m in February.
Real level of retail sales in Switzerland increased by 1.5% m/m in February against the decline by 2.4% m/m in January; level of CPI in Switzerland rose by 0.6% m/m (+1,0% y/y) in March against the forecast of growth by 0.2% m/m. It is an ambiguous factor for Swiss economy as on the one hand the economy strengthens and on the other hand it suffers from significant inflationary pressure.
The head of the National Bank of Switzerland, Mr. Hildebrand noted that strong and expensive Franc undermines exports and disrupts tourism industry; therefore negative impact of the CHF can be stronger than predicted. “We intend to take any measures to achieve price stability” stressed monetary politician. According to him, downside risks to recovery are still preserved, although economy demonstrates more steady growth rate than previously expected. Statement made by Hildebrand that long term expansionary monetary policy constitutes a menace to some industrial sectors is worthy of being noted.
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