With the Switzerland KOF Leading Indicator coming out significantly positive compared to what was foretasted as well as the weak dollar we’ve been seeing recently, we could see this pair push lower.
Looking on the weekly time frame we can see that we are in a bearish trend. We recently had the break below the key level at 0.92000 we support turned into resistance shown by the downward pointing arrows.
On the 4 hour time frame, we can see we’ve had two touches off of the descending trend line as well as creating a new lower low.
On the 1 hour chart, we can see we’ve rejected the 50% Fib level which lines up with the double bodies to the left. A more attractive risk to reward would be to wait for the third touch of the trend line which coincides with the 61.8% Fib level as well as another set of double bodies to the left which offers more resistance.
The KOF Leading Indicator is designed to predict the direction of the economy over the following six months. The index is made up of various economic indicators such as banking confidence, for example. It is looking highly likely that the Swiss Franc will gain further against the dollar, especially with the amount of money we can see being pumped into safe havens by looking at the price of gold.
Remember to always stick to your trading plan and try to build as many confluences as possible before entering any set-up.