EUR/CHF Signals & Technical Analysis
About the theEUR/CHF (EURO & Swiss franc)
The EUR/AUD pair is the abbreviated term used for the Euro & Swiss franc. the Euro and Swiss franc nicknamed as “Euro-Swissy
Before we get into the particulars, what exactly does the EUR/CHF rate mean? The exchange rate tells you how many Swiss francs (the quote currency) are required to purchase one Euro (base currency). For example, if the pair is trading at 1.14, it means it takes 1.14 CHF to buy 1 Euro
Breaking Down ‘EUR/CHF’
The euro (€; EUR) is the official currency of 19 of the 28 member states of the European Union. The euro is the second largest and second most traded currency in the foreign exchange market after the United States dollar. The euro is divided into 100 cents.
Whereas, the Swiss franc, is a reserve currency. Therefore its value surges during times of uncertainty as investors seek safe-haven options. The exchange rate of Swiss Franc is also determined by economic factors such as interest rates, trade balance, and inflation, but the prices of gold, oil, and coal also tend to be important factors. This pair is known as a pair trend because there are usually great upward or downward trends. It is also often adapted to Swing Trading but because of its lack of buoyancy, it is less popular with scalpers. The EUR/CHF and the USD/SHF exchange rates are highly positively correlated.
What Determines the EUR/CHF Exchange Rate?
Several factors can impact the EUR/CHF rate valuation, including
ECB & SNB Monetary Policies The bank of the European Central Bank and Swiss National Bank control the supply of money in the market, to keep the economy on track. A dovish policy, which is also known as expansionary policy, from either of the central banks, weakens the related currency. In contrast, a hawkish monetary policy (contractionary policy) strengthens the currency.
Economic Events: The movement in the Swiss Franc and Swiss National Banks determine the exchange rates. Top of the line economic events include GDP, Employment Change, Industrial Production, and Consumer Price Index. Better than forecast data increases the demand for the related currency and impacts the value of either the Euro or the Swiss Franc, causing fluctuations in the EUR/CHF exchange rate.
Major Economic Events:
Gross Domestic Product – the Gross Domestic Product is the central measure of economic growth in the region.
Employment Change – Both currencies are sensitive to changes in employment, as slacks in the labor market cause a drop in Inflation rates.
Consumer Price Index – Since one of the goals of ECB and SNB is to maintain price stability, they keep an eye on inflation indicators such as the CPI. If the annual CPI deviates from the central bank’s target, the central banks could make use of their monetary policy tools to keep inflation in check.
The balance of Trade – Australia and Switzerland have an extremely robust trade the sector, so currency traders and bank officials alike tend to watch changes in the countries’ export and import levels.
Political announcements & natural disasters – Besides the scheduled economic events, political elections, new systems, wars, terror incidents, natural calamities, etc. can all cause severe variations within the EUR/CHF.
Correlation is merely a mutual relationship or connection between two or more things.
Positive correlation – The positive relationship merely is when pairs move in tandem with each other.
In the forex world, the CHF/SGD, CAD/CHF and USD/CHF currency pairs are positively correlated.
Negative correlation – In contrast, a negative relationship is when forex pairs move in the opposite direction, For example, CHF/SGD, XAU/EUR, and CHF/JPY
The euro is one of the most important alternatives to the U.S. dollar among fiat currencies This is why there is often a positive link between the euro and gold: both assets are negatively correlated with the greenback. However, the relationship is far from being a perfect correlation, but also against the current monetary system based on fiat currencies.
Economic Events: The movement in the European and Switzerland events determine the exchange rates. Top of the line economic events includes GDP Employment Change, Industrial Production, and Consumer Price Index. Better than forecast data increases the demand for related currency and impacts the value of either the Euro & Swiss franc, causing fluctuations in the EUR/CHF exchange rate.
Major Economic Events:
Gross Domestic Product – the Gross domestic product is the central measure of economic growth in the region.
Employment Change – The Euro is also sensitive to changes in employment, particularly in the Eurozone’s largest economies like Germany and France.
Employment Change – The Swiss franc is sensitive to changes in employment, as slacks in the labor market cause a drop in Inflation rates.
Standard lot Size: 100,000
Mini lot size: 10,000
Price minimum increment: 0.00001
Pip Value: $9.81