Forex Strategy Video: Trading Implications for USDCHF from EURUSD, EURCHF
• USDCHF recently dropped back to a two-year low following a 7-day decline
• A floor in EURCHF, questions about the euro's strength and a dollar Taper outlook creates opportunity
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Is a bottom inherently more appealing than a top? EURUSD has put in its first bearish day in 8 trading sessions, and USDCHF its first bullish day in 8. This is not a coincidence as the two pairs maintain an extreme, negative correlation - meaning they move in opposite direction and at the same intensity most of the time. Yet, this creates an interesting situation for a USDCHF chart that otherwise looks like a head-and-shoulders pattern. The outlook for Euro with ECB stimulus discussions, the Dollar with the Fed's Taper discussion and the SNB's 1.2000 floor all factor into the USDCHF's future. We look at this pair more closely in today's Forex Strategy video.
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