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Main » 2016 » February » 15 » Forex analytics and EURCHF forecast: full circle. Long-term and medium-term targets
Forex analytics and EURCHF forecast: full circle. Long-term and medium-term targets

Fundamental analysis of the euro franc

It's been more than two years after the SNB let national currency to float freely, and, judging by recent statements by Thomas Jordan, the measure brought a certain result. Procrastination and indecision can do billions SNB expenditure. 



 Established in 2011, the ratio of the course CHF 1,20: 1,0 EUR was caused by a problem of a strong franc. In turn, the decision taken on 15 January 2015, was largely the result of the quantitative easing policy, launched by the European Central Bank since mid-2014. Then began his weakening of the single currency, pulled behind him and his neighbor, a vector which has made a significant bias to the detriment of the Swiss economy.

In such circumstances the intervention could only help locally, and the abolition of the threshold of the course became a matter of time.

Changes in US monetary policy, aimed at increasing interest rates, resulted in a greater discharge swissy against the dollar and the British pound, which clearly was not in the plans of the SNB management.

As a consequence of two evils to choose less.

At that time, the abolition of the fixed exchange rate was a shock for Swiss exporters as a sharp strengthening of the franc led to a drop in demand for the products manufactured by them.

"To date, the national currency is still overvalued," - said Thomas Jordan, although not as significant as it was in the first days after the lifting of the threshold rate.

However, 2015 ended with the Swiss for the supplier is not the best way. In particular, it has affected those who supply their goods to the euro area, therefore, the SNB policy will be aimed at further reducing the franc.With regard to the euro, these figures are 7-8% from current levels, which heralds the return of the tandem exchange into the area so all the habitual price abroad 1.20.

This scenario may become a reality before the year is finished. While continuing correction of almost all major stock indexes, which originated on the background of a slowdown in China's economy, increasing the risk factor will put pressure on market participants, the latter declining to preserve their capital and transfer them to a more reliable assets.

In such circumstances, the funded status of the euro currency would gain a certain stability, and to take advantage of weaknesses "Swiss".

It has increased the demand for the euro and the statement of the Iranian authorities that the calculations for oil deliveries will be made in the currency of the European Union.

Given the slow pace of the ECB's management to expand the program of quantitative easing, but the willingness to start SNB intervention at any time, to see the growth of the pair EURCHF, we can in the very near future.

Technical analysis and forecast

Timeframe D1

In the first months of this year, the price has managed to make a mark on the upward momentum 1.07590 and out of the range, began their formation back in September of 2015.

As a result, quotes firmly fixed above the level of their average values, by drawing with the new local maximum value at the price 1.11990, but the MA found The order of the rising inertia with pronounced upward trend.

This pattern makes it more likely to believe that the emerging bullish trend within the D1 scale, has the potential for further advancement

Based on the foregoing, we can conclude that the current phase of decline is corrective, and the discrepancy between the price chart and indicator OsMA in the form of a bull convergence points to the likelihood of its completion.

The role of this signal increases as the quotes returned to the 21st (red) and the 50th (orange) moving averages, the interaction of which can have the exchange rate support and lay the foundations for a new upward impulse.

Forecast. The completion of this corrective movement in the area of ​​price values ​​of 1.09500 - 1.08800, corresponding to the region MA21 and MA50, which is expected to change in the next phase of its growth wave for the following purposes:

The first goal - a mark 1.13670; 
The second goal - a mark 1.14190; 
third objective (long-term) - Mark 1.20000. 
{} The D1

Conclusions and Recommendations

Fundamental and technical analysis of the components of a further increase in rate for EURCHF pair.

Signs completion downward corrective retracement in the Daily chart scale and make it possible to make purchases from the current levels.

Search entry points for opening long position is recommended to make in view of the situation on the younger timeframes in order to increase the profitability of transactions.


A source

Analysis Alpari


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