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Should We Focus on the Downside Potential of the Swiss Franc, Which Has Weakened Against the Yen?

Market Report

Should We Focus on the Downside Potential of the Swiss Franc, Which Has Weakened Against the Yen?

Today's Highlights
  1. Germany's Third-Quarter GDP
  2. Europe: ECB Policy Rate and Statement Release

In yesterday’s U.S. currency markets, the U.S. dollar rose against the euro following the Federal Open Market Committee’s (FOMC) decision to cut interest rates by 0.25%. The EUR/USD pair fell from 1.1665 to 1.1578. It dropped from the +2σ to the -3σ levels on the hourly Bollinger Bands.On the 4-hour chart, the 200 EMA is acting as an upper resistance level, causing prices to decline, while on the daily chart, prices are currently being capped along the 20 MA. Note that the U.S. dollar has softened again during today’s Asian trading session, so we will be watching for directional cues during European trading hours.

Among European currencies, the Swiss franc fell against the yen. The CHF/JPY pair dropped from 191.943 to 190.503. The price broke significantly below the 200-period SMA support line on the hourly chart with a real body candle.On the 4-hour chart, the price has already moved below the 20-MA, and on the daily chart, the uptrend along the 10-MA is beginning to break down. Furthermore, since the daily RSI has surged to 76, we will be watching closely to see if the current correction continues.

Today, around noon, Japan’s BOJ policy rate and statement will be announced; at 15:30, France’s third-quarter GDP and consumer spending figures will be released, followed by a press conference by BOJ Governor Ueda; at 17:00, Switzerland’s KOF Leading Index will be released; and at 17:55, Germany’sunemployment rate, at 6:00 PM Germany’s Q3 GDP, at 7:00 PM the Eurozone’s Q3 GDP, at 10:00 PM Germany’s Consumer Price Index, at 10:15 PM the Eurozone’sECB policy rate and statement release at 22:45, ECB President Lagarde’s press conference at 22:55, remarks by Fed Vice Chair Bowman at 23:30, and U.S. weekly natural gas inventories at 23:30.We’ll be watching for further downside potential in the Swiss franc against the yen.

桜井 慶介

Author: Keisuke Sakurai

He has over 10 years of experience in FX trading. In the financial sector, he has been involved in investment management focused primarily on foreign exchange markets and has experience as an asset management advisor. Drawing on his extensive experience, he specializes in technical and fundamental analysis.

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