AUD/CHF – Technical Analysis for Binary Options Brokers
Australia – Cash Rate
On Tuesday, at GMT 4:30 a.m., the Reserve Bank of Australia (RBA) released the official cash rate, which is the interest rate that major Australian banks and financial institutions pay to borrow funds held at the RBA.
Since short-term interest rates are the primary factor in the valuation of the Australian Dollar against other major currencies, Binary options brokers pay close attention to any changes in the official cash rate.
The RBA left the cash rate at 1.5% in their last meeting and the forecast for this month is that the RBA will leave the cash rate unchanged at 1.5% for the time being.
Switzerland – Foreign Currency Reserves
On Thursday, at GMT 7:00 a.m., the Swiss National Bank released its foreign currency reserves figure, which 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, when the demand for the CHF is low. Hence, this figure can indicate how actively the central bank is participating in the market and. Hence, binary options investors consider this to be 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 714 billion, compared to 693 billion in the previous month, which signaled that the SNB is trying to increasing their reserve.
Since breaking above the downtrend line on July 12, 2017, the AUD/CHF quickly went up to the 0.7760 level. However, since then, in the last few weeks, the pair mostly remained range bound, where the 0.7695 level acted as a major resistance to any upside potential.
As the Australian cash rate is expected to remain unchanged at 1.5%, but the Swiss foreign exchange reserve has been growing over the past few months, we believe these macroeconomic developments would not play any significant role in determining the directional movement of the AUD/CHF this week. Therefore, based on last week’s increase in bullish momentum, if the AUD/CHF price breaks above the 0.7695 level, we believe 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 0.7695.
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