Key Points
- The British Pound managed to spike higher to move above the 1.2100 resistance area vs the Swiss Franc.
- There was a major bearish trend line formed on the 4-hours chart of GBPCHF at 1.2050, which was cleared to open the doors for more gains.
- Today, the Swiss Trade Balance report was released by the Federal Customs Administration.
- The outcome was better, as there was a trade surplus of 4,374M in Sep 2016.
GBPCHF Technical Analysis
The British Pound managed to register a close above the 1.2100 resistance area against the Swiss Franc to encourage the bulls. There was a major bearish trend line formed on the 4-hours chart of GBPCHF, which the buyers managed to break at 1.2050.
The pair traded as high as 1.2201, and currently correcting lower. However, there is a major support on the downside in the form of the 21 hourly simple moving average.
Moreover, the 50% Fib retracement level of the last leg from the 1.2004 low to 1.2201 high is also around the 21 hourly SMA. So, it represents a major support where buyers may appear.
Swiss Trade Balance
Today in Switzerland, the Trade Balance, which is a measure of balance amount between import and export was released by the Federal Customs Administration. The market was expecting a trade surplus of around 4,000M in Sep 2016.
However, the result was better than the forecast, as there was a trade surplus of 4,374M. The report highlighted that “Between July and September 2016, exports grew by 8.1% corrected for working days (real: + 2.8%) and imports by 7.9% (real terms: + 4.7%). In both approaches, the chemical-pharmaceutical products dominated the development. So these were responsible export side for about 80% of the total additional revenue. The surplus in the trade balance exceeded the first time in a quarter of the 10 billion-franc stamp”.
Overall, the report was positive, which is helping the Swiss Franc at the moment, but the GBPCHF pair has an important support on the downside waiting to provide bids.
