Trading the USD/CHF

The USD/CHF trading pair pits the U.S. dollar against the Swiss franc. It’s nickname is the “safe haven currency” because  investors tend to turn to this currency to perform better during times of geo-political tensions and other uncertainties. It is also called “Swissy.” It is considered one of the majors in the forex market. It reacts much like the GBP/USD and has similar characteristics.

However, it only accounts for around 4% of the global daily trading volume. It is referenced by the number of Swiss francs per U.S. dollar. In terms of how it measures up with other majors, it is not very liquid. Liquidity describes how smoothly prices move. Liquidity and market interest for the USD/CHF is the thinnest among the majors, particularly during European trading hours.

Technicalities of the USD/CHF

  • USD/CHF is traded in amounts designated in USD.
  • The pip value or minimum price fluctuation is in CHF.
  • Profit and loss accumulates in CHF.
  • Margin calculations are frequently made in USD.

Switzerland conducts 80 percent of its foreign trade with the Eurozone. So in terms of its economy, it is most concerned with the CHF level against the EUR rather than the USD. Therefore, the Swiss National Bank, only enters the forex market when the CHF is either too strong or too weak against the EUR.

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Swiss Data Reports to Analyze

  • Swiss National Bank rate decisions and speeches by directorate members
  • Retail sales
  • PPI and CPI
  • KOF Leading Economic Indicator
  • Trade balance
  • Unemployment rate