Play of the Day: Is CHF/JPY Getting Ready to Extend Its Uptrend?

CHF/JPY made lower highs and lower lows but is also seeing buying pressure near an inflection point.

As you can see, CHF/JPY has been in an uptrend since the stat of the month. The pair hit a resistance at 168.40, though, and now it’s trading closer to the 167.50 level.

Has CHF/JPY traded low enough to bring the bulls back?

CHF/JPY 1-hour Forex Chart by TradingView

In a few hours, the European Central Bank (ECB) is expected to hold its interest rates steady after ten consecutive meetings of rate hike decisions. The ECB isn’t expected to shed its hawkish biases, however, with President Lagarde recently warning that the fight against inflation isn’t over just yet.

A high interest rate environment is NOT a good look for the Eurozone. This week’s PMIs alone have shown that the region is experiencing choppy economic growth!

Meanwhile, USD/JPY is flirting with the big 150.00 handle and Bank of Japan (BOJ) officials haven’t shown much alarm over it other than doing a bit more jawboning.

If USD/JPY busts above 150.00 today, or if growth concerns in Europe translate to CHF demand, then CHF/JPY may draw enough buying pressure to extend its uptrend.

Look for a clear bounce from the 167.00 – 167.50 area or a clear breakout above its trend line resistance for increased chances of a trip to 168.50 or the 169.00 are of interest.

Of course, CHF/JPY may also see a downside breakout today. If it turns out that there are enough JPY bulls around USD/JPY’s 150.00 handle, then CHF/JPY may see enough bearish pressure to trade below the 1-hour chart’s Pivot Point (167.12) or 200 SMA levels.

Safe havens like CHF and JPY may see increased volatility as we get top-tier news releases like the ECB decision and U.S. GDP so make sure you’re watching the newswires and your trades closely to minimize your risks and maximize your returns!

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.

CHFJPYDayExtendPlayReadyUptrend
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