Swiss economic growth accelerated more than economists expected in the first quarter, joining the upturn seen across much of Europe at the start of the year.
Even with the strong first-quarter showing, there’s downward pressure on the economy amid a global slowdown and escalating trade tensions that have hurt business confidence and demand. In Switzerland, the manufacturing Purchasing Managers Index is at its lowest since 2015 and the KOF’s business situation index has fallen for five straight months.
The Swiss National Bank has also warned of the likelihood of Switzerland suffering from the impact of trade tensions. One major repercussion could be another appreciation of the franc, with implications for exporters in the small, trade-reliant economy.
Because of Switzerland’s long history of financial stability which includes a stable economy and stable banking system and positive trade balances, low national debt level, the Swiss Franc, along with the Japanese Yen serve as a safe haven currencies during risk off environments.
So where is the Swish Franc heading next, lets go to the charts?
Price has left the monthly supply at 1.02500, the last time price was here was back in Jan. 2017.
Price is respecting the monthly up trendline which started in February 2018.
Price has formed a “M” pattern, a reversal pattern on the daily chart.
Thus, the set-up is if price can pull back to the 4 hr supply at 1.01500, to short price with the potential to take it all the way down to the monthly demand at 0.92500…which would be almost a 1000 pip trade.
This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.