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The GBP/CHF continued to retrace the advance from the previous week, and pulled back from the yearly high to hold a narrow range over the week, and the pair may continue to fall lower over the near-term as risk appetite abates.

Currency Pair: GBP/CHF
Chart: 60 Min Charts
Short-Term Bias: Flat

Analysis

The GBP/CHF continued to retrace the advance from the previous week, and pulled back from the yearly high to hold a narrow range over the week, and the pair may continue to fall lower over the near-term as risk appetite abates. After reaching a high of 1.8976 in November, the pound-franc slipped to a low of 1.5124 on 12/29 following the drop in risk appetite, but the turnaround in market sentiment has led the pair higher throughout this year, and the pound-franc may continue to push higher over the near-term as market participants anticipate the Swiss National Bank to maintain a floor on the exchange rate. However, the lack of momentum to break above 1.8140-50 (78.6% Fib) could leave the GBP/CHF range-bound over the near-term, and we may see the pair continue to move sideways as investors weigh the outlook for future policy. Over the next few hours of trading, we may see the pair fall lower on the back of British pound weakness but nevertheless, as the RSI approaches oversold territory, moves to the downside are likely to be capped, and the pair may attempt to test 1.7698, the 6/15 low, for short-term support. Be sure to check out other Technical Reports from DailyFX for additional information on the major currency pairs.

To contact the author of this article, please email: dsong@fxcm.com

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