EUR/CHF Surge: Interest Rate Differential Drives Pair to New Highs
The EUR/CHF currency pair has seen significant upward momentum in recent trading sessions. According to Christopher Lewis, a technical analyst at DailyForex, this is due in part to the interest rate differential favoring the Euro.
Lewis notes that the pair broke through the 0.9350 level on Thursday and appears to be attempting a further breakout. He attributes this to increased risk appetite in the market as well as the Golden Cross technical indicator, where the 50-day EMA breaks above the 200-day EMA.
Lewis emphasizes that the interest rate differential is a key factor in the pair's movement, stating that it 'favors the buyers.' He also notes that holding the EUR/CHF pair comes with benefits, including earning interest at the end of each day. As such, he advises traders to buy on dips rather than attempting to short the pair.
Lewis identifies key support levels for the pair at 0.94 and 0.9450, which were previously a swing high and a significant level respectively.