Key Technical Levels
The USD/CHF has traded in tight channels and ranges which makes it the ideal pair for scalpers. Although we have seen bout of volatility recently it was a product of concerns over the Dubai debt default and not part of the recent natural trading pattern. The break below parity creates the potential for continues consolidation as traders decide whether to push the pair lower and risk possible intervention. The path of least resistance may be higher but with dollar support fleeting bullish momentum has been non-existent.
Quantitative Metrics
The USD/CHF’s narrow Bollinger band width and tight ATR adds to its attractiveness for scalpers. The pair’s average true range of 103 pips is the lowest of the pairs listed below. Additionally, a Bollinger Band width of 254 pips and an implied volatility of 10.50 signals that the pair should continue seeing a low volatile environment. The one potential caveat is the threat of intervention from the SNB which is a possibility with the pair below parity.
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To discuss this report or be added to the email list, contact John Rivera, Currency Analyst: jrivera@fxcm.com
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