There are no major reports coming up in the next session, so I’m looking at this USD/CHF triangle consolidation setup for now.
Risk appetite was feeble in the past few hours as traders continue to keep tabs on the repercussions of the pandemic. There haven’t been a lot of positive updates recently, though, so safe-havens remained supported.
Check out the headlines that dominated today’s Asian trading and how major forex pairs are looking so far:
Fresh Market Headlines & Economic Data:
- U.S. coronavirus deaths pass 100,000 mark
- White House: President Trump to issue executive order against social media companies
- Riot police deployed in Hong Kong as tensions rise
- South Korean central bank cut interest rates
- RBA Gov. Lowe: Negative rates extraordinarily unlikely
- Lowe: Evidence of economic stimulus working so far
- ANZ business confidence index up from -45.6 to -41.8
- Australia’s Q1 private capital expenditure down by 1.6% vs. projected 2.6% slump
Upcoming Potential Catalysts on the Economic Calendar:
- German preliminary CPI coming up
- Spanish flash CPI due 8:00 am GMT
- BOE MPC member Saunders’ testimony at 11:00 am GMT
What to Watch: USD/CHF
It’s gonna be another light London session in terms of data, so a quick consolidation play on this pair might work out.USD/CHF has formed lower highs and higher lows to form a symmetrical triangle pattern on the 1-hour time frame, and the pair looks ready for a test of support.
Stochastic is pointing down to show that there’s some selling pressure left, but the oscillator is already closing in on the oversold region to signal exhaustion. Turning back up could confirm that a bounce is in order.
Risk-off flows from earlier today could also keep the lower-yielding dollar supported, although the franc has some safe-haven appeal on its side, too.
Dollar traders might decide to take it easy ahead of the release of the U.S. preliminary GDP reading later in the day, preventing any major breakouts from happening over the next few hours.
Not sure where to place your entries and exits? MarketMilk’s USD/CHF volatility tables should help sort things out!