Currency investors should consider buying USD/CHF this week, advised Barclays Capital Research.
"We like chasing last week's move higher in USD/CHF. With the SNB showing no signs of changing policy stance, we think markets will finally consider the CHF as a compelling funder.
Moreover, a weaker CHF is unlikely to be met by SNB resistance, given the bank's view, and ours, that the currency remains extremely overvalued." Barclays argues.
Technically, Barclays notes that stochastic momentum indicators suggest that the pair is still oversold and believes that the pair will soon test the 100-day moving average at 0.9815, and the long-term resistance at 0.9859.
" However, if USD/CHF falls below the significant June-December 2016 support level around 0.9550, we see the pair retesting last week's lows and moving lower."
Source of the graph: Bloomberg Pro Terminal
Trader - S. Fuchedzhiev
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