EUR-CHF Poised to Go Higher

By: Mike Kulej The Japanese Yen has not been the only currency getting significantly weaker since the G7 central banks intervention few weeks ago. Another “safe haven” currency, the Swiss Franc has also been on defensive during the same time, falling broadly. This is particularly visible against the currencies where the CHF reached all time extremes, such as the US Dollar, the British Pound and the Euro. On the daily chart of the EUR-CHF, we can see the rally from 1.2409 to the current 1.3220. This happens to be a very important resistance level tested twice before.

A breakout above this level would signal a continuation in this rally, suggesting the next objective at 1.3675 or so. Perhaps more importantly, though, it would complete the double bottom reversal pattern in the EUR-CHF, likely reversing the long-term bear market in this pair.

For that, we must see a daily close above the resistance, which has not happened yet. In addition, one should be mindful about the ECB rate decision on Thursday. Markets are clearly expecting a hike in rates, something that the central bank hinted at before. If there is no action, the Euro could suffer for a while. In the long run, though, the EUR-CHF is poised to move higher.
http://www.dailyforex.com/forex-technical-analysis/2011/04/EUR-CHF-Poised-to-Go-Higher/7624