Is someone feeling out the SNB and their supposed unofficial EURCHF floor at 1.0800?
The SNB still strikes fear into many retail traders so the ongoing rumours that the SNB has a soft floor in EURCHF will have more than a few shivering with historical recollections. Whether or not the SNB is stepping in there, the level is being well defined.
EURCHF H4 chart
We've only had the briefest of dips below 1.08 this year and the most notable was over the Brexit vote. When we have, we've not often passed below 1.0790. I'm liking the look of what could be a tight long down around 1.0810 with a stop under 1.0780. If the SNB are there then that's a help but if they're not, there's likely to be more than few traders thinking they are, and so will probably do the job for them by front running any possible SNB support. If the level is broken then at 30 odd pips, the trade won't be an account killer anyway.
Also under the cosh is USDCHF, which I spoke about last week after ING put out a recco to buy a close above 0.9950. In that post I noted yet another confluence of moving averages on the daily chart around 0.9768-0.9781.
USDCHF daily chart
We're only 30 odd pips off the first of those ma's so we might get a look at them sooner rather than later. I'm looking at a small long from that area as I want to push the stop down quite far to around the 100 wma at 0.9702. I'll probably put it just under to avoid any big figure noise. Once again this might be another trade that's triggered by the FOMC tomorrow.
