According to the Swiss Association of Exporters and Swissmem (the Swiss association of mechanical and electrical engineering industries), the Swiss Franc is protected from considerable currency fluctuations but numerous Swiss companies may be affected if the Franc will keep strengthening.
Over the recent months such traditional “safe heaven” assets as the US Dollar and the Japanese Yen have partially lost their investment attractiveness. Investors keep abandoning some European assets as well. No wonder than Switzerland’s currency starts looking more attractive against the weakening US Dollar, the natural disaster in Japan and the continuous debt problem in Greece. Moreover, Switzerland’s economy is expected to grow by 2.1% this year, which is much higher than in any other developed country, which sounds even more reassuring for investors.
At the beginning of the financial crisis EURCHF was traded around 1,7. Now it is around 1.2. The Central Bank of Switzerland failed to restrain the strengthening of its currency.
FOREX.
The Swiss Franc keeps gaining value against the common currency. According to the Department of Masterforex-V TS, EURCHF is currently forming wave C of Daily 2 (the classic 5-wave pattern). The “Hound of the Baskervilles” pattern by Elder/MF will continue the downswing on the daily chart. The closest support levels are 0,8240 and 0,8040 (the match of significant Fibonacci levels). A mid-term reversal can be considered only after the price breaks above the MF pivot and sloping channel (as shown below).
