After the market’s recent moves, GBP/CHF is approaching a critical technical resistance level. Are we on the brink of a breakout to the upside this week, or are the bears poised to step in and maintain the pair within a long-term range? Let’s delve into the 4-hour chart for some insights!
The British pound drew buying interest yesterday, partly because the U.K.’s flash December PMIs indicated persistent high price pressures. This could potentially give the Bank of England (BOE) pause before aggressively relaxing its monetary policies. However, the PMIs also highlighted concerns about the labor market and the demand for manufactured goods. At the same time, a continued drop in the U.S. dollar might bolster the Swiss franc, as investors seek safe-haven alternatives in upcoming trading sessions.
It’s critical to remember that market price movements are often influenced by fundamental factors. If you haven’t kept up with the latest on the British pound and the Swiss franc, now’s the time to check out the economic calendar and stay informed on daily fundamental updates!
Currently, GBP/CHF is oscillating within a 250-pip range and is testing the 1.1350 range resistance on the 4-hour chart. It’s worth noting that the wicks on the pair’s latest candlesticks suggest limited demand near this technical resistance level.
Could it be that GBP/CHF bulls are pausing for breath, or are we about to witness the bears defending their ground? We’re closely monitoring for bearish candlesticks that might trigger a potential retest of the 1.1300 psychological level.
Moreover, if the pullback from the range resistance gathers momentum, we might see a return to the 1.1250 Pivot Point and mid-range levels, where both the 100 and 200 Simple Moving Averages (SMAs) are currently situated.
Conversely, should we observe bullish candlesticks and sustained trading above the R1 (1.1344) Pivot Point line, it could attract more GBP/CHF buyers, potentially pushing the pair to higher areas of interest such as 1.1400 or 1.1500.
No matter which scenario unfolds, keep in mind that developments like the U.K.’s employment data, CPI figures, and the BOE’s December decisions could influence GBP/CHF’s price action this week. As always, stay alert for other significant catalysts that could sway overall market sentiment and ensure you employ proper position sizing when making trades!
