Bullish Sentiment Dominating The USD/CHF
Shain Vernier • 1 min read
The USD has been on a tear today, posting nice gains across the majors. Highlights have been rallies in the USD/CHF, USD/JPY, and a bearish move in the EUR/USD. As we roll into the late-U.S. session, it appears that currency players are optimistic over Friday’s U.S. Q2 GDP report.
The consensus among industry experts is that tomorrow’s Q2 U.S. GDP figures are likely to come in well beneath Q1. Q2 estimates are currently in the neighborhood of 1.8% annualized, down from the 3.1% of Q1. This is a rather large drop, but does take into account U.S./China trade war fallout and the severe weather that plagued mid-Western agricultural producers last spring.
If the action in the USD/CHF is any indication, traders are favoring GDP to exceed industry projections.
USD/CHF On The March
Perhaps the most impressive move today for the Greenback has been the bullish breakout in the USD/CHF. Subsequently, rates have broken through daily topside resistance and are above the .9900 handle.
Overview: Moving forward, the USD/CHF is going to be dramatically impacted by FED policy, Brexit, and global economic performance. At this point, it appears that this market is in the process of re-pricing next week’s projected FED rate cut.
As traders balance the books in response to the FED’s actions, one has to wonder if a USD/CHF run to par value is the cards for early-August. Before the rate-cut mania of June, 1.0000 acted as formidable topside resistance. Now, it appears that par may be tested yet again, possibly sooner than we thought only a week ago.