Eur/Chf Outlook- Swiss Intervention

Feb.15.2010

The Swiss National Bank is on an intervenbtion spree, says Yohay Elam at Forex Crunch. Catch Yohay, and TheLFB trade team on ForexTV Live.  

Observing the graph of EUR/CHF, the interventions are clearly seen. The first one is on Friday, January 29th at around 17:00 GMT, near the end of day. The SNB didn’t like the 1.4650 level and sent the pair up.

The second is much stronger – it happened on Friday, February 5th at around 2:00 GMT. The intervention had a stronger effect during the Asian session, after EUR/CHF fell to almost 1.4550. But also here, the effect didn’t last for a long time.

When was the third intervention? You guessed right – the next Friday. On February 12th, the SNB made a minor push during the busy London session and made a stronger move at around 15:00 GMT, as it eyed 1.4650 once again. It’s still to be seen how this will evolve.

Why does the bank intervene?

The Swiss economy is based on exports – Switzerland has a surplus in it’s trade balance. The main trading partners come from the Euro-zone – Germany, France, Austria and Italy all border the Alp nation. A weaker currency means more value for exports. Full Article…