AUD/CHF Penetrated Key Support amid Declining Australian Building Approvals

Switzerland – Manufacturing PMI

Today, at GMT 8:30 a.m., Procure released the Swiss manufacturing PMI, which measures the level of a diffusion index by surveying 200 purchasing managers in the country.

Since businesses react quickly to changing market circumstances, their purchasing managers tend to have the most updated information about their company’s view regarding the economy. Hence, binary options traders pay special attention to Swiss manufacturing PMI data in order to understand the market sentiment.

In December 2015, the Swiss manufacturing PMI reading came out at 49.7 and the forecast for January was set at 50.2. However, the actual index reading came out much better than expected, at 52.1

Australia – Building Approvals

On Thursday, at GMT 12:30 a.m., the Australian Bureau of Statistics will release the national month-over-month building approvals figure, which measures the changes in the number of approvals of new buildings.

Since a build permit indicates new construction work, it suggests that there would be additional positive economic activities. For example, new jobs would be created for construction workers. Therefore, binary options traders consider this data regarding new building approvals to be a leading indicator of the overall economic health of the country.

Last month, the building approvals figure went up by 3.9% and the forecast for this month is currently set at a decrease of 2.8%.

Trade Recommendation for the AUD/CHF

AUDCHFDaily

Although the AUD/CHF broke below the uptrend line on December 8, the support around 0.7100 kept the price from falling further. As a result, the AUD/CHF price was on a retracement for last two weeks.

Once the AUD/CHF price reached near the 0.7300 pivot zone last week, it found a strong resistance and the downturn seems to be resuming. Today, so far, the AUD/CHF price has fallen by 130 pips and penetrated the minor support near 0.7190.

As the Australian building permit figure is expected to decline by 2.8% this month, the fundamental outlook for the AUD/CHF would be bearish as well.

Under the circumstances, it would be recommended that traders consider placing a PUT order for the AUD/CHF with their binary options brokers once the price closes below the 0.7190 level.

Recommended Broker: HighLow.net

About our Forex and Binary Options Analyst:  Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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