Par Value In View For The USD/CHF

Posted Monday, September 2, 2019 by
Shain Vernier • 1 min read

The Greenback is putting in a solid forex session, posting significant gains vs the euro and Swiss franc. In fact, the USD/CHF is in the process of extending last week’s range, driving toward par value. 

During the early European session, the Swiss SVME Purchasing Managers’ Index (August) was released to the public. While the figure did come in above the previous release and expectations, it still suggested bearish manufacturing performance. The SVME Purchasing Managers’ Index is far from a primary market driver, but the news has contributed to the USD/CHF’s run at par value.

Will The USD/CHF Revisit Par Value?

In every market, there is a key psychological level that attracts two-way trade. For WTI crude oil, it is $50.00; for the DJIA, 25000 is a huge number. For the Swissy, currency traders keep an extra close eye on par value (1.0000).

USD/CHF, Daily Chart
USD/CHF, Daily Chart

Here are the numbers to watch in the USD/CHF for the coming sessions:

  • Resistance(1): Par Value, 1.0000
  • Support(1): Daily SMA, .9813

Bottom Line: Rates for the USD/CHF are on the move north, having gained more than 250 pips since the lows of August 12. Currently, it appears as though a return to par value is a probable scenario for the Swissy.

Shorting 1.0000 on its first test isn’t a bad way to trade this market. Until elected, I will have sell orders queued up from 0.9989. With an initial stop at 1.0017, this trade yields 25 pips on a standard 1:1 risk vs reward management plan. 

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