USD/CHF breaches the SMAs and sharply surges

USD/CHF breaches the SMAs and sharply surges

'Prices of assets such as bonds, agricultural land, and high-yield and leveraged loans are at historically high levels. We must not ignore the possibility that the low-interest rate policy may be creating incentives that lead to future financial imbalances.' - Kansas City Fed President (based on Bloomberg)

Pair's Outlook

USD/CHF pair has demonstrated a strong bullish impetus recently, as the price has overcome the 55-day and 100-day SMAs in one day. As the core indicators remained beneath the spot price, the pair is in a bullish trend, moving towards a 0.94/0.95 consensus. Currently the price is just above the weekly R2 level at 0.9354, but above it there is a free area to move higher. Only at 0.9460, the 200-day SMA is located.

Traders' Sentiment

The Swiss Franc is heavily short currency, since the majority of traders bet for the U.S. Dollar appreciation—88% of positions are long and only 12% are short. Pending orders situation is neutral, as 52% of orders are for a long position and 48% are for a short one.