The EUR/CHF pair is one that has been neglected and ignored by most of you out there. What frankly, it’s not really a big surprise as this market has been very difficult to be excited about for some time. Nonetheless, I see a potential buying opportunity if we can get above the 1.2160 handle. If that happens, I think that the consolidation area will come back into play, but it could be a very slow moving trade.
At this point in time, I think that the 1.21 level is pretty safe as far as a “floor” in this market, especially considering that the Swiss National Bank has lost its sense of humor about an extraordinarily strong Swiss franc. I think that if we drop below there, it’s only a matter of time before the SNB gets involved in starts buying this pair again. The market knows this, and therefore doesn’t really have any real interest in testing their patience.
This is going to take some patience.
I do think that ultimately this pair goes higher, but you’re going to have to be very patient with this move. This is one of those trades that you need to buy it and simply forget about it for some time, probably putting in a take profit order at the 1.2230 region. With that being the case, it’s more of an investment if you want to think of it that way, as I don’t see this pair suddenly taken off in one direction or the other. However, I would be remiss if I didn’t mention this particular setup as I just happened to notice it today. (Just by saying that statement out loud, I admit that I am guilty of ignoring this pair as well.)
Ultimately, I think we will break out to the upside, but right now there’s so much trouble with the Euro that is difficult to imagine that anything with the EUR in the front of the pair name will see massive amounts of strength. However, this pair doesn’t look like it’s ready to fall anytime soon.