The British pound advanced against the Swiss franc this week, with the rally supported by the rising trending in the 50-Day moving average, and the GBP/CHF may continue to push higher over the remainder of the week as the economic docket is expected to reinforce an improved outlook for the U.K.
[B]Currency Pair:[/B] GBP/CHF
[B]Chart:[/B] 60 Min Charts
[B]Short-Term Bias:[/B] Bullish
[B][U]Analysis[/U][/B]
The British pound advanced against the Swiss franc this week, with the rally supported by the rising trending in the 50-Day moving average, and the GBP/CHF may continue to push higher over the remainder of the week as the economic docket is expected to reinforce an improved outlook for the U.K. After reaching a high of 1.8976 in November, the pound-franc slipped to a low of 1.5124 on 12/29 as investors curbed the appetite for risk, but the turnaround in market sentiment has led the pair higher throughout the first half of year, and the pair is likely to hold the rising trend over the near-term as investors speculate the Bank of England to tighten policy over the next 12 months. Credit Suisse overnight index swaps shows investors are pricing a 100bp rate hike by the BoE next year and expectations for higher borrowing costs may continue to drive the British pound higher against its currency counterparts over the near-term. Over the next few hours of trading, we may see the pair continue to push higher as U.K. mortgage approvals are expected to rise in June, and we may see the pair continue to retrace the sell-off from earlier this month as the economic outlook for Great Britain improves. However, as risk trends continue to drive price action in the foreign exchange market, a rebound in risk aversion could weigh on the GBP/CHF and may lead the pair to fill-in the gap from the 120-SMA as the low-yielding currency continues to benefit from safe haven flows. Be sure to check out other Technical Reports from DailyFX for additional information on the major currency pairs.
[I][B]Visit the [/B][/I][I][B]DailyFX Forex Stream[/B][/I] [I][B]for Real-Time News and Market Updates[/B][/I]
[I]To contact the author of this article, please email: <[email protected]> [/I]
[B][I][I] Related Articles:[/I][/I][/B]
[I][B]Euro Stalls Ahead of Yearly High; Sets Up Potential Double Top (Daily Classical)[/B][/I]
[I][B]Forex Options and Futures Show US Dollar Bottom Likely[/B][/I]
[B][I][I]Stability in the Dollar and Risk Trends Won’t Last Long[/I][/I][/B]
[I][B]Australian Dollar Reaches 2009 High; Euro Failing Before 1.4340[/B][/I]