The first upswing in the Swiss leading indicator for six months has helped the carry-embattled Franc alleviate some support in European trading. The upwardly revised December KoF headline destroyed the hopes of a dovish January 1.51/52 reading. The previous data was revised from 1.60 to 1.75, thus the January 1.71 still represents a dip but not as significant a drop as many had hoped for.
The data combined with the event-risk produced by the Roth comments, due Tomorrow (after 14:00 GMT), have forced many to reverse CHF positions and the market is now awash with short-term sell EUR/CHF recommendations. French names target 1.6060 in the short-run while Swiss players opt for a Q2 correction back to 1.58 while an aggressive US name is now talking up the chances of a 50bp Q1 hike from the SNB.
As a result expect the Franc to find renewed strength as buy-backs continue. USD/CHF may be driven by US data and the FOMC into North American trading but bids into the 1.2500 area are eyed on the downside while stops below 1.60 are targeted in the Euro cross.
No comments:
Post a Comment