Major currency pairs traded worldwide have unusual characteristics. Choice of pairs
depends on the trader’s category and style.
Eight major pairs include:
1. EUR/USD
2. GBP/USD
3. USD/CHF
4. USD/JPY
5. AUD/USD
6. USD/CAD
7. EUR/GBP
8. EUR/JPY
Besides Dollar and Yen, CHF or Confoederatio Helvetica Franc is the 3rd
currency. CHF is the legal and certified exchange currency of Swiss and Liechtenstein.
Franc is still used by CBS (Central Bank of Switzerland).
BIS survey’s recent report regarding the USD/CHF currency pair states that it makes
just 4% of total trading amount. This clearly indicates that this major currency pair is
least liquid in comparison to high unstable pairs. Still, it is regarded as an important
pair. Why?
Swiss and United State currencies are regarded as reserve currencies because both
the tries are technologically advance, sound and stable. However the economies of
both the countries differ in nature due to their structures of government, education,
military, health, taxation, environment, crime rate, language and so on.
Why traders opt for CHF?
When traders expect markets to take a hit or crash due to unfavourable events
affecting the world, their way out alternative is CHF. Other feature that sets CHF
apart from the world economies is their Swiss bank secrecy level towards their bank’s
account holders.
CHF indicates a strong financial system, low redundancy, low inflation curve and more.
It is not similar to the countries like USA and Japan that are snowed under high debt
and continuous deficit in finances.
Economists also consider Swiss currencies to be strong because it progressively
displays its strength. Especially, during terrorism activities or geopolitical crisis, traders
purchase CHF. The reason is that Switzerland reflected neutral character that was
displayed throughout the World War I & II.
Cases & events affecting USD and CHF
Issues that possibly impact Swiss economic condition are:
• GDP Index observations
• Trade Balance status
• Consumer Price Index reports & observations
• SNB (Swiss National Bank) 3 months, Monetary Policy assessment
• SNB three month Target Libor rates release and observations
• Economist statements released on national or international forums
Issues that affect USA economy include:
• Unemployment rate
• Balance of trade
• Non-farm payrolls
• Rate decision FOMC
• GDP releases & ISM
• Consumer confidence level
• Observations of Philadelphia Fed Survey
• CPI
• Producers price index
• Fed President statements, speeches and talks
USD/CHF currency pair – Trading styles
1. Day trading
2. Swing trading
USD/CHF pair is also open to false alarms, rumours, and at times traders observe that
it moves very swiftly through the support or resistance level, without any reversals.
Therefore, another pre-condition for traders is to get acquainted with technical
analysis while trading this pair.
Learn basic analysis of news, which can possibly impact the economies of USD and
CHF. You can learn more on PrimeTrade regarding trading styles. Another thing to
understand is when to catch up with most powerful hours. USD/CHF power trading
lasts for 4 hours daily.
Power trading hours
• 8 am – 12 pm EST (European session comes to a close, whereas American
markets open)
• 2 am – 12 pm EST (European session is dynamic)
• 8 am- 5 pm (US session is lively)
Trader’s insight, sharp and accurate decisions will help him to trade successfully and
prosper.
