EURCHF RETREATS AFTER THE DOVISH SNB INTEREST DECISION

The price of crude oil held steady on Thursday as several of the most respected oil traders warned that the price could soar to $200 a barrel. In a statement to FT, Pierre Andurad, a well-known oil trader said that he expects prices to rise to as high as $250 this year. Similarly, Doug King, the head of RCMA Merchant Commodity Fund warned that this trend is not transitory. He expects that prices will keep rising this year. Just last week, the head of Trafigura said that sanctions will lead to a loss of as much as 3 million barrels of oil per day. Trafigura is one of the biggest oil trading companies globally.

The Swiss franc strengthened against the US dollar after the latest decision by the Swiss National Bank (SNB). The bank decided to continue with its ultra-expensive monetary policy by leaving rates unchanged at -0.75%. The bank also committed to conducting regular interventions in a bid to prevent the currency from strengthening. In 2021, the bank spent over $21 billion in interventions, which involves selling the franc. It also continued its view that the currency is still overvalued.

The UK and European economies are doing modestly well even as a war continues in Ukraine. According to Markit, the European Union’s manufacturing and services PMI was at 57 and 54.8, respectively in March. In the UK, the PMI declined from 58.0 to 55.5. Other countries like Germany and France also had strong PMIs. Manufacturers and service providers were generally optimistic about business prospects as the impact of the pandemic wanes. However, there is a general dissatisfaction because of the rising cost of doing business.

EURCHF

The EURCHF pair retreated after the latest SNB decision. It managed to move to a multi-week low of 1.0232. As a result, the pair has moved below the important support 1.0268. It is also slightly above the parity level of 1.00. The pair has also dropped below the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has been heading downwards. Therefore, the pair will likely keep falling, with the next target being at parity.

EURUSD

The EURUSD pair was in a tight range after the strong European PMI numbers. It is trading at 1.100, which is along the important ascending trendline. It has formed a head and shoulders pattern and moved slightly above the 23.6% Fibonacci retracement level. The pair’s 25-day moving average and the Relative Strength Index (RSI) have also flattened. Therefore, the pair will likely have a bearish breakout in the coming days.

ETHUSD

The ETHUSD pair has been in a bullish trend in the past few days. It is trading at 3,056, which is an important resistance level since it struggled to move above it in February. It remains above the envelopes indicator while the MACD and the Relative Strength Index (RSI) has been in a bullish trend. Therefore, the pair will likely keep rising if bulls manage to move it above this resistance level.