- The Euro has fallen a bit against the Swiss franc during the trading session on Thursday as we continue to see a lot of choppy volatility.
- The 0.91 level is an area that offers a bit of a floor, and I do think a lot of people will be watching very closely due to the fact that it is offering support over the last couple of days.
Ultimately I think looking at this chart you have to keep in mind that if we were to break down below the 0.91 level then the Swiss National Bank might get involved because they have complained more than once about the idea of the Swiss franc being too strong and it's likely that the Swiss National Bank will care about this due to the fact that 85% of Swiss exports end up in the European Union.
The Swiss National Bank is highly regarded as one of the most active central banks in the world as they will not hesitate to intervene if the franc gets too strong. If the market turns around from here and it is trying to do so from the back half of the day, we could see this market try to go to the 0.92 level which is an area that has been significantly resistant.
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Resistance and Potential Intervention
If we were to break above there then that could be a bit of a trend change at least in the short term and I think the play might be looking for some type of upward momentum to join. If the market were to break down below the 0.91 level, we would be looking at the 0.90 level and potential intervention.
This is a market that I don't have any interest in shorting I am looking for an opportunity to buy this market, but I also recognize that there is a lot of downward pressure. We need more of a risk appetite type of market to return in order for this market to really pick up momentum so I'm hoping to see a little bit of a charge higher that I can join and am aware that if this pair breaks down drastically all of the Swiss franc denominated pairs suddenly come into the attention of market participants as the Swiss National Bank could start to tinker.
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