Forex Market: EUR/CHF daily trading forecast

Yesterday’s trade saw EUR/CHF within the range of 1.2062-1.2099. The pair closed at 1.2071, losing 0.16% on a daily basis.

At 6:18 GMT today EUR/CHF was up 0.01% for the day to trade at 1.2074. The pair touched a daily high at 1.2076 during early Asian trade.

Fundamental view

Euro zone

Spains current account probably produced a deficit of 0.3 billion EUR in July, according to market expectations. In June the country had a surplus at the amount of 0.517 billion EUR, which followed five consecutive months with a deficit.

The current account reflects the difference between savings and investments in the country. It is the sum of the balance of trade, net current transfers (cash transfers) and net income from abroad (earnings from investments made abroad plus money sent by individuals working abroad to their families back home, minus payments made to foreign investors).

A current account surplus indicates that the net foreign assets of the country have increased by the respective amount, while a deficit suggests the opposite. A nation with a surplus on its current account is considered as a net lender to the rest of the world, while a current account deficit puts it in the position of a net borrower. A net lender is consuming less than it is producing, which means it is saving and those savings are being invested abroad, or foreign assets are created. A net borrower is consuming more than it is producing, which means that other countries are lending it their savings, or foreign liabilities are created. A larger than projected deficit on Spains current account might have a limited bearish effect on the euro.

The Bank of Spain is expected to release the official data at 8:00 GMT.

Switzerland

The gauge of economic sentiment in Switzerland probably plunged to -12.0 in October, according to the median forecast by experts. In September the index came in at a reading of -7.7. The ZEW (Zentrum für Europäische Wirtschaftsforschung) economic expectations index is published on a monthly basis. The study encompasses up to 350 financial and economic analysts. The indicator reflects the difference between the share of analysts, that are optimistic and those, that are pessimistic about economic development in Switzerland over the next six months. A positive value indicates that the proportion of optimists is larger than that of pessimists. A ZEW reading of -100 suggests that all analysts are pessimistic about the current developments and expect economic conditions to deteriorate. A ZEW reading of 100 implies that all analysts are optimistic about the current situation and expect conditions to improve. A ZEW reading of 0 indicates neutrality. Lower than projected readings would have a bearish effect on the franc. The official data is scheduled to be released at 9:00 GMT.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.2077. In case EUR/CHF manages to breach the first resistance level at 1.2093, it will probably continue up to test 1.2114. In case the second key resistance is broken, the pair will probably attempt to advance to 1.2130.

If EUR/CHF manages to breach the first key support at 1.2056, it will probably continue to slide and test 1.2040. With this second key support broken, the movement to the downside will probably continue to 1.2019.

The mid-Pivot levels for today are as follows: M1 – 1.2030, M2 – 1.2048, M3 – 1.2067, M4 – 1.2085, M5 – 1.2104, M6 – 1.2122.

In weekly terms, the central pivot point is at 1.2104. The three key resistance levels are as follows: R1 – 1.2134, R2 – 1.2175, R3 – 1.2205. The three key support levels are: S1 – 1.2063, S2 – 1.2033, S3 – 1.2000.