Safe-haven support continues to fuel a rally in the Swiss Franc up to 23-month highs, although it has lostsome ground to the Euro this morning even after the mixed results from Euro zone “flash” PMI readings. SNBofficials may not be happy with the current valuation of the Swiss Franc given their nation’s low inflation levels butuntil global risk appetites are revived, prices are likely to remain underpinned in close proximity to these recenthighs. The December Swiss should find early support around the 112.10 area this morning, but may bevulnerable to a much larger pullback if today’s US data is able to produce a positive surprise for the market.
Technical Outlook
CHF (DEC): A positive indicator was given with the upside crossover of the 9 and 18 bar movingaverage. Rising stochastics at overbought levels warrant some caution for bulls. The market’s close above the 9-day moving average suggests the short-term trend remains positive. The close over the pivot swing is asomewhat positive setup. The next upside target is 112.70. With a reading over 70, the 9-day RSI is approachingoverbought levels. The next area of resistance is around 112.46 and 112.70, while 1st support hits today at111.78 and below there at 111.34.