Another collection of strong U.S. employment numbers is driving investors to the Greenback, specifically the USD/CHF. About an hour ago, the Continuing Jobless Claims (Oct. 5) and Initial Jobless Claims (Oct. 12) were released to the public. Both beat expectations, further accentuating the “rosy” American employment situation.
The result has been bids hitting the Swissie and Loonie. Performance across the majors is mixed for the Greenback, but these two pairs are giving USD bulls reason for optimism. The USD/CHF appears poised to revisit par value (1.0000).
USD/CHF Technical Outlook
The value area between .9900 and 1.0000 has been critical all year long for the USD/CHF. The summer months saw extreme consolidation in this range, until a late-August break to the bear took it out of the picture. Now, price has returned to this key area.
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Bottom Line: At press time, the USD/CHF is grinding higher near the .9975 handle. A run at 1.0000 looks probable for later on in today’s U.S. session. For the rest of the day, short scalps from the top of value will be good trade location to the short. Sells at .9997 with an initial stop at 1.0013 will produce 10 pips on a sub-1:1 risk vs reward ratio.
Sellers are very likely to step up and defend 1.0000 on the initial test. In the event we see a definitive break above this level, it will be best to make a hasty exit and look for a position short in coming sessions.
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