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2 Oct 2013
EUR/CHF bouncing amidst dovish Draghi comments
FXstreet.com (Athens) – The EUR/CHF is heading slightly upwards as Draghi states that “inflation remains broadly balanced.”
EUR/CHF choosing the upper level thanks mostly to “Letta win confidence vote”, not Draghi
It seems that the EUR/CHF manages to move slightly upwards not exactly on Draghi’s press conference speech, but mostly on the fact that the Italian political debacle evolves as it appears that Prime Minister Letta will retain the coalition, thus, the single currency gets a bit “lifted-up” on good news regarding the Italian political backdrop. Draghi’s didn’t exclude another round of LTRO, suggesting also that “ECB discussed rate cut, says ECB has vast array of instruments.” Furthermore, Draghi commented that “it is essential to strengthen the resilience of banks, banking union will help reduce fragmentation,” as well that “Euro area growth risks remain on the downside.” Finally, the president of ECB stated that “Draghi says exclude no action and ready to act includes the possibility of another LTRO.”
Technical Outlook on EUR/CHF
Karen Jones, Head Technical Analyst at Commerzbank suggests that the “has held the initial test of the 1.2217 June low. Rallies are now expected to find initial resistance offered by the 1.2266 August low and remain capped by the 1.2307 200 day ma. Note only above 1.2315 will alleviate immediate downside pressure. Intraday charts are suggesting this rebound should terminate circa 1.2280.This has left the market vulnerable on the downside to further losses and it targets 1.2135/32, the April lows.”
EUR/CHF choosing the upper level thanks mostly to “Letta win confidence vote”, not Draghi
It seems that the EUR/CHF manages to move slightly upwards not exactly on Draghi’s press conference speech, but mostly on the fact that the Italian political debacle evolves as it appears that Prime Minister Letta will retain the coalition, thus, the single currency gets a bit “lifted-up” on good news regarding the Italian political backdrop. Draghi’s didn’t exclude another round of LTRO, suggesting also that “ECB discussed rate cut, says ECB has vast array of instruments.” Furthermore, Draghi commented that “it is essential to strengthen the resilience of banks, banking union will help reduce fragmentation,” as well that “Euro area growth risks remain on the downside.” Finally, the president of ECB stated that “Draghi says exclude no action and ready to act includes the possibility of another LTRO.”
Technical Outlook on EUR/CHF
Karen Jones, Head Technical Analyst at Commerzbank suggests that the “has held the initial test of the 1.2217 June low. Rallies are now expected to find initial resistance offered by the 1.2266 August low and remain capped by the 1.2307 200 day ma. Note only above 1.2315 will alleviate immediate downside pressure. Intraday charts are suggesting this rebound should terminate circa 1.2280.This has left the market vulnerable on the downside to further losses and it targets 1.2135/32, the April lows.”