Various European central bank meetings have today (BoE & ECB) stymied much of the short-term volatility that would normally be produced by the overnight Bernanke comments. As a result USD/CHF momentum intraday has been generated by buying in EUR/CHF ahead of various option expiries.
Today EUR 1Bln 1.5900 strikes are set to mature, at the NY cut at 14:00 GMT, while tomorrow another EUR 1Bln of expiries at the 1.5900 level sit on the calendar. As a result gamma related interest has been seen and buyers remain keen to push the cross above 1.5900. This buying forced USD/CHF above its early European 1.2505 top. Yet with the price looking out of kilter to other Dollar majors, fresh supply has continued to dampen the rally. In contrast short-term accounts are looking for the break into the 1.2500"s to job spot back towards 1.2445. Offers are seen trailing to 1.2450 with 1.2475 seen as the key downside trigger.
Elsewhere, the KOF upped its 2006 & 2007 growth outlook (2006 from +2.1% to +2.6%, 07 to +2.1% from +1.9%) while economists look to the Hildebrand speech later in the day and the Swiss Jobless release due tomorrow at 05:45 GMT.
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