- During the trading session on Monday, we have seen the British pound spiking against the Swiss franc, slicing through the 1.14 level.
- This is an area that’s been important multiple times, so I do find it interesting that we are continuing to see a certain amount of strength.
- If we can break above the top of the candlestick for the Monday session, that would be a very positive sign, perhaps sending this market much higher.
However, if we were to break down from here, it would just reinforce the idea of a major barrier being at the 1.14 level. Ultimately, this is a market that continues to look strong, and I would not be interested in shorting this market until we get well below the 1.13 level. Underneath there, then we start to break down below the 20 Day EMA, opening up the possibility of a move down to the 1.11 level, which is the bottom of the overall consolidation area that we have been in previously.
Risk Appetite
Keep in mind that risk appetite has a major influence on this pair, as the Swiss franc is considered to be a major “safety currency”, and that of course is a currency that people go running to when they get the opportunity. All things being equal, as long as the market isn’t falling apart in general from a risk appetite perspective, it’s very likely that the British pound does in fact break higher against the Swiss franc.
Top Forex Brokers
Ultimately, this is a market that tends to be very noisy and you have to be somewhat cautious with your position sizing, but you do get paid at the end of every night, and that of course is worth paying attention to as interest rate differential continues to be a major driver of currencies over the longer term. We are in the process of trying to break out of a tight consolidation area, and therefore you should be paying close attention to the way this is behaving.
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