AUD/CHF Broke Downtrend Line and Testing Key Resistance Near 0.7025 Ahead of Swiss Forex Reserves Data

AUDCHF – Technical Analysis for Australian Binary Options

Australia – Trade Balance

On Tuesday, at GMT 12:30 a.m., the Australian Bureau of Statistics released the monthly Trade Balance figure. It measures the difference in value between all import and export. This figure also includes physical goods and intangible services.

The demand for export correlates with the demand for the Australian Dollar. Therefore, GoMarkets traders analyse the monthly trade balance. They do so to gauge the strength of the AUD against other major currencies.

Last month, the Australian trade balance figure came out at 2.32 billion. The forecast for this month was that it may come out at a bit lower, at 2.18 billion. However, the actual figure came out much lower, at 1.93 billion.

Switzerland – Foreign Currency Reserves

On Wednesday, at GMT 8:00 a.m., the Swiss National Bank will release its foreign currency reserves figure. It 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. It happens when the demand for the CHF is low. Hence, this figure can indicate how actively the central bank is participating in the market. Therefore, binary options investors consider this an important fundamental indicator of the CHF’s future directional movement against other major currencies.

Last month, the Swiss foreign exchange reserves figured came out at 749 billion. Over the last few months, the figure fluctuated between 731 and 750 billion. If it comes out lower than last month, it will likely have a bullish effect on the Swiss Franc.

AUDCHF Forecast

AUDCHF Analysis for Australian binary options - January 8 2019

After the AUDCHF broke below the uptrend line on December 6, it fell by around 500 pips to 0.6675 level. In fact, last Wednesday, the AUD/CHF fell by over 250 pips. However, since then, the pair started a swift bullish retracement. On January 4, the AUDCHF broke above the downtrend line and currently testing the resistance around 0.7025.

The Australian trade balance figure came out way low compared to the estimate at 1.93 billion. On the other hand, the Swiss Foreign Currency Reserves might continue to fluctuate within the range between 730 and 750 billion. Under the circumstances, the directional movement of the pair is not being driven by market fundamentals. However, from a technical perspective, if the AUD/CHF closes above the resistance near 0.7025, it would likely attract additional bullish momentum in the market.

Hence, Australian binary options traders should look out for trading opportunities above this major resistance level around 0.7025.

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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