Hot real money has been ploughing into the CHF since the Russian invasion of Ukraine and the CHF has been doubly attractive as the only ‘other’ safe-haven buy alongside the USD. A slightly unexpected 50bps rate rise by the SNB followed by a 3 month meetings holiday certainly hasn’t harmed the CHF.
Speculative leveraged positioning in the CHF is quite moderate according to most reports I’ve read, with most reporting small net CHF short positions.
I’m taking a bit of a punt here in trying to pick the bottom of a sharp move but as we know, these reversal moves tend to be the most lucrative and quickest returns, once the trend stalls. I have no doubt that this trend will indeed reverse, and sharply at that, but getting the timing right is always fraught with danger.
The pairs I’m looking at are USD/CHF, AUD/CHF and GBP/CHF.
I’m definitely a bit early on USD/CHF but I’m keeping longs at a minimum and looking to add on dips towards strong technical support around .9300 or if/when bullish momentum returns to the short-term outlook.
AUD/CHF I am more comfortable with. I’ve also only got the minimum position here and I’m trading the short-term moves hoping to get on it when it starts moving higher. A break above .6750 will have me feeling more comfortable and I can then start adding on dips. A break below .6500 will tell me that my timing is off (again!)
GBP/CHF as always will be the riskiest one but potentially the most satisfying if it comes off. I’m watching the short term charts for any signs of a bottom forming. If it does I will be aggressively building longs looking for at least an 800 pip rally.
Be careful out there.