Should We Be Wary of a Corrective Drop in the Swiss Franc/Yen Pair, Which Tapped the High 158-Yen Range?
20.06.2023
- Switzerland—Trade Balance
- U.S. — Williams: Remarks by the President of the New York Fed
In the U.S. currency market yesterday, volatility in the GBP/USD pair declined because U.S. markets were closed for a holiday. The GBP/USD pair fell by approximately 60 pips from 1.2836 to 1.2771. This break below the 20-period moving average on the hourly chart marks a reversal of the uptrend that had been in place since the 5th of this month.On the higher-time-frame daily chart, the pair has broken well above the 1.2739 line—the upper boundary of the ascending parallel channel—so traders should be on the lookout for a corrective pullback.
Among European currencies, the Swiss franc—which is set to release its trade balance data today—traded in a seesaw pattern against the yen. The CHF/JPY pair fluctuated between 157.929 and 158.771.During today’s Asian trading session, the pair has been trading around 158.162. Given that the CHF/JPY pair still has room to rise toward the upper boundary of the monthly parallel upward channel—which began in June 2012—at the mid-162 yen level, we should watch for a continued upward trend following a period of consolidation.
Today, at 3:00 p.m., Germany’s Producer Price Index, Switzerland’s trade balance, and Japan’s machine tool orders will be released; at 5:00 p.m., the Eurozone’s current account balance;at 5:30 p.m., Hong Kong’s Consumer Price Index; at 6:00 p.m., the Eurozone’s Construction Output; at 7:30 p.m., remarks by U.S. Federal Reserve Bank of St. Louis President Bullard; at 9:00 p.m., Hungary’s MNB policy rate and Mexico’s retail sales;U.S. Housing Starts and Building Permits at 21:30, and remarks by U.S. Federal Reserve Vice Chair Barr and New York Fed President Williams at 24:45. We should remain cautious of a corrective decline in the Swiss franc/yen pair, which recently touched the upper 158 yen range.
Author: Keisuke Sakurai
