The Swiss Franc experienced large volatility when their central bank abruptly withdrew the FX intervention that was keeping the franc down. The large one-day rise that ensued. along with the equivalent one-day drop in the Swiss equity index, provoked extension signals. Those movements have since reversed and all the ground gained and lost has reverted to the levels that existed before the drama began. Now we have seen some top extensions in the Pound vs the Swiss Franc and we would adopt a trade that buys the Franc, sells the £. Charts:
We are a little late with this analysis – yesterday would have been the appropriate day to point this out, for which we apologise. It may be better to try to buy a dip/sell a rally back toward 1.50/1.51. There is an attendant risk – that the market may push prices in the anticipated direction immediately and so waiting for a better price might mean missing the trade.
