TriumphFX Forex Analysis – CHF Pairs – April & May 2020


AUDCHF – Daily & 4 Hour Charts

AUDCHF Daily Chart
AUDCHF 4 Hourly Chart

As suggested in our last AUD chart analysis, the AUDCHF has been bearish and has swung lower.

Price is clearly down-trending on the daily time-frame. AUDCHF has recently been very bearish and has formed a much lower swing low. Price is now in a retrace move. The daily moving averages are bearish and widening, signalling that the long-term trend could continue. The 4 hour RSI is becoming overbought, suggesting that AUDCHF could soon attempt a bearish move.

Shorting opportunities may exist around the daily moving averages, around the trend resistance area and around the horizontal levels at 0.6225, 0.6345, 0.6430, 0.6605, 0.6640 and 0.6860. A bearish move could find support around the dynamic support of the 4 hour moving averages and around the horizontal support levels at 0.5600 and 0.5390.

The Swiss National Bank (SNB) continues to keep rates at the all-time low of -0.75%. The Swiss economy continues to be stagnant. The economy was showing signs of positive momentum but COVID-19 is causing the economic to contraction. The Swiss Franc continues to be highly valued as a safe-haven currency. The SNB recently announced that it will continue to intervene with in foreign exchange markets but will likely keep rates unchanged until at least 2021.

The Reserve Bank of Australia (RBA) cut rates again in their April 2020 meeting. Rates were cut by a further 0.25%, bringing the official bank rate to 0.25% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate the economy due to COVID-19 recession fears. The RBA will continue to monitor the labour market and inflation. Rates will not be raised until targets are met.

CADCHF – Daily & 4 Hour Charts

CADCHF Daily Chart
CADCHF 4 Hourly Chart

Price is clearly down-trending on the daily time-frame and is currently in a retrace phase. The daily moving averages are bearish and widening, signalling that the downtrend could continue. CADCHF is looking indecisive on the 4 hour time-frame. The moving averages confirm this – they are tightening and are moving sideways. Price action has formed a diagonal support of the 4 hour.

Shorting opportunities may exist around the 50.0% and 61.8% Fib levels, around the daily moving averages, around the daily trend resistance area, if CADCHF closes below the 4 hour diagonal support and around the horizontal levels at 0.6975, 0.7260 and 0.7440. A bearish move could find support around the 4 hour diagonal support, the 4 hour moving averages and around the horizontal support levels at 0.6680 and 0.6615.

The Bank of Canada (BOC) followed the US by slashing it’s benchmark interest rate. The intent of the rate cut is to help boost the economy during the COVID-19 pandemic. The current rate is now 0.25%. The economy is currently performing well and inflation targets are currently at their potential. If coronavirus fears deescalate, the BOC could increase rates again in the near future.

The Swiss National Bank (SNB) continues to keep rates at the all-time low of -0.75%. The Swiss economy continues to be stagnant. The economy was showing signs of positive momentum but COVID-19 is causing the economy to contract. The Swiss Franc continues to be highly valued as a safe-haven currency. The SNB recently announced that it will continue to intervene with in foreign exchange markets but will likely keep rates unchanged until at least 2021.

USDCHF – Daily & 4 Hour Charts

USDCHF Daily Chart
USDCHF 4 Hourly Chart

USDCHF is down-trending within a potential daily bearish channel. The daily moving averages are bearish and widening, signalling that the bearish direction may continue. Recent price action has been choppy though, signalling potential market indecision. The 4 hour chart confirms the current indecision – the moving averages have been crossing frequently and price has been moving sideways.

Trading opportunities could exist around the support and resistance areas of the bearish channel and around any of the identified horizontal levels at 0.9270, 0.9245, 0.9495, 0.9595, 0.9785, 0.9885, 1.000 and 1.0205.

The Reserve Bank of Australia (RBA) cut rates again in their April 2020 meeting. Rates were cut by a further 0.25%, bringing the official bank rate to 0.25% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate the economy due to COVID-19 recession fears. The RBA will continue to monitor the labour market and inflation. Rates will not be raised until targets are met.

The Federal Reserve has announced a record breaking stimulus package, aimed at US households and employers. The US Federal Open Market Committee (FOMC) has unexpectedly cut rates by 150 points due to heightened concerns regarding the COVID-19 outbreak. The current Fed Funds rate is currently 0.25%, back at post-2008 levels. There is some concern that keeping rates low could cause greater issues in the US’ financial sector. The USD has been acting as a safe haven amid the COVID-19 outbreak. There are some concerns that the COVID-19 pandemic may hit the US hardest, causing a reversal of the recent USD strength.

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