USDCHF – Technical Analysis for Binary Options Brokers
Switzerland – Foreign Currency Reserves
Later, at GMT 8:00 a.m., the Swiss National Bank released its foreign currency reserves figure, which measures the total value of foreign currency reserve held by the central bank.
The currency reserve usually goes down when the Swiss National Bank tries to defend the rate of the Swiss France in the open market, when the demand for the CHF is low. Hence, this figure can indicate how actively the central bank is participating in the market and. Hence, binary options investors consider this to be an important fundamental indicator of the CHF’s future directional movement against other major currencies.
Last month, the Swiss foreign exchange reserves figure came out at 630 billion, compared to 628 billion in the previous month, which means the SNB is trying to maintain its currency reserves instead of reducing or increasing it.
United States – Unemployment Claims
On Thursday, at GMT 1:30 p.m., the US Department of Labor will release the unemployment claims figure, which measures the changes in the number of people who claimed for unemployment insurance over the last week.
Binary options traders consider the unemployment claims data to be one of the most important fundamental indicators of the US job market. This is primarily because unemployment and consumer spending has direct correlation and an increasing number of unemployment claims indicate lower consumer spending in the economy, which makes up the bulk of the economic activity in the United States.
Over the last several weeks, the US unemployment claims figure came out between 246,000 and 260,000. Last week, it came out at 265,000 and this week, the forecast is set at a slight increase to 267,000.
Trade Recommendation for the USD/CHF
On October 25, the USD/CHF formed a bearish pin bar and within the next few days, it broke below two of the uptrend lines. By last week, the pair fell around 250 pips and found support near the 38.2% Fibonacci retracement level of the last major upswing, which is at 0.9666.
Although the USD/CHF price closed below the uptrend line, the next day, the market reversed, closing above the trend line once again. However, today, the USD/CHF price bounced from the resistance around 0.9800 and appearing tentative about the direction.
The lack of directional movement could be explained by the fact that both Swiss Foreign Currency Reserve and the US unemployment claims figures would likely remain somewhat unchanged compared to last reporting periods.
As there would be no major changes in the market fundamentals, if the USD/CHF price breaks below the current support around 0.9725, it would likely attract additional bearish momentum that may push the price further down.
Under the circumstances, it would be recommended that binary options traders consider placing a PUT order for the USD/CHF with their binary options brokers as soon as the price closes below the 0.9725 level on the daily time frame.
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