The AUD/CHF pair is probably one that you don’t pay very close attention to, but it is at your own risk. After all, the market looks at this as a proxy for risk. The Australian dollar is without a doubt a relatively “risky asset”, while the Swiss franc is certainly a safety currency. Money tends to flow into Switzerland when times are a bit scary, while money flows into gold and Australia when traders feel comfortable. With that, the market looks as if we have been doing fairly well over the course of several months, and as a result the pair continued to climb.

The channel drawn on the chart is still holding true, and as a result we should continue to see upward pressure. This is especially true after seeing the Wednesday candle break above the top of the shooting star for Tuesday. That of course is very bullish, and as a result the market should continue to head towards the 0.85 handle. It is there where we see significant selling pressure, and I think that a move above there should send this market to eventually head to the 0.90 level.

Excellent trend, and as a result I like this trade a lot.

I like this trend a lot, as it has been very steady. With that being the case, I feel that it is correct to continue buying the pair. On top of that, the Australian dollar has shown significant strength against the US dollar over the last couple of days. We are at a massive support level in a pair, and any time you talk about the Aussie dollar, you have to look at the AUD/USD pair as well. Since the Australian dollar does look like it’s due for a bounce, this should only add fuel to the fire when it comes to this pair. I think that the 0.85 level will be targeted first, but ultimately I believe that pair gives way and then we head all the way up to the 0.90 level, probably continuing to form the channel that we are in.

Related Articles
  1. Personal Finance

    Salary Secrets: What Is Considered a Big Raise?

    A 4% or 5% annual jump in pay may not sound huge, but in today’s environment, it actually means you’re faring better than most.
  2. Retirement

    6 Steps to Update or Change Your Will

    Life changes – a new marriage, the birth of a child – can necessitate changes in your will.
  3. Insurance

    What Does It Cost To Raise a Child in America?

    Having a family can be an expensive proposition, but couples who know the numbers can strategize to lower the costs.
  4. Bonds & Fixed Income

    Calculating Yield to Worst

    Yield to worst is the lowest possible yield on a bond that may be called in the future.
  5. Economics

    What Does Vesting Mean?

    Vesting is the process of accruing non-forfeitable rights.
  6. Economics

    Understanding Retail Banking

    Retail banking refers to the mass-marketed, consumer-oriented products and services offered by the local branch of the commercial bank.
  7. Investing Basics

    Explaining Foreign Exchange Risk

    Foreign exchange risk is the chance that an investment’s value will decrease due to changes in currency exchange rates.
  8. Economics

    What Happened at the Fiscal Cliff?

    The fiscal cliff refers to a scenario on December 31, 2012, in which the Bush-era tax cuts were set to expire.
  9. Economics

    Explaining Enterprise Resource Planning

    Enterprise resource planning (ERP) is management software that integrates a business’ essential departments.
  10. Investing Basics

    What's Current Portion of Long-Term Debt?

    The current portion of long-term debt is the part of a company’s long-term debt that must be repaid within the next year.
  1. Sticky Wage Theory

    An economic hypothesis theorizing that pay of employees tends ...
  2. Cost Of Funds

    The interest rate paid by financial institutions for the funds ...
  3. Earnings Before Interest & Tax ...

    An indicator of a company's profitability, calculated as revenue ...
  4. Implied Volatility - IV

    The estimated volatility of a security's price.
  5. Plain Vanilla

    The most basic or standard version of a financial instrument, ...
  6. Operating Cost

    Expenses associated with the maintenance and administration of ...
  1. Are dividends considered passive or ordinary income?

    Despite the fact that earning dividends requires no active participation on the part of the shareholder, they do not meet ... Read Full Answer >>
  2. Is dividend income taxable?

    Dividend income is taxable but it is taxed in different ways depending on whether the dividends are qualified or nonqualified. ... Read Full Answer >>
  3. How do dividends affect net asset value (NAV) in mutual funds?

    Distribution of dividends reduces the net asset value (NAV) of mutual fund shares. However, this doesn't mean that fund investors ... Read Full Answer >>
  4. Are mutual funds considered retirement accounts?

    Unlike a 401(k) or Individual Retirement Account (IRA), mutual funds are not classified as retirement accounts. Employers ... Read Full Answer >>
  5. How do dividends affect the balance sheet?

    Dividends paid in cash affect a company's balance sheet by decreasing the company's cash account on the asset side and decreasing ... Read Full Answer >>
  6. Do mutual funds invest only in stocks?

    Mutual funds invest in stocks, but certain types also invest in government and corporate bonds. Stocks are subject to the ... Read Full Answer >>

You May Also Like

Trading Center

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!