FxWirePro: Euro reaches target against franc at 1.137; partial profit bookings recommended

In mid-June this year, in an article named, “FxWirePro: Buy euro against franc targeting 1.12”, available at http://www.econotimes.com/ , we suggested buying the euro against franc at the ten current rate of 1.089, with a target around 1.12 area and with a stop loss around 1.06. Here are some key notes from that piece,

“The geopolitical risks that have surrounded the single currency have now diminished significantly with a decisive victory by Emmanuel Macron in the French Election.

Moreover, the recent economic releases from the continent suggest that the economy has started gathering pace. Several economic dockets released today, support this theory. Data showed that French wage growth accelerates at the best pace in three years. European new car sales approach pre-financial crisis high. Labor costs in Spain have stopped shrinking. While the Swiss economy is not doing bad either with its trade balance at 11 percent of GDP and the unemployment rate at 3.3 percent, the euro has a lot to gain against the franc, when we consider the risk aversion flight during the debt crisis of 2011/12. Moreover, the market is going to pay attention to the fact that the Swiss National Bank (SNB) intends to weaken franc and is likely to be the last man standing on the easing front.

We at FxWirePro believe that the euro could gain towards 1.12 against the franc, however, one must note that this pair is a very slow moving one. Stop loss should be kept around 1.06 area.”

After euro reached our target of 1.12 against the franc, we extended the target to 1.137, which got reached today, in a spike before the exchange rate retraced back to 1.135. We would like to recommend partial profit bookings in the tune of 65-75 percent. We do not have any further targets for the pair now but feel that the momentum might lead to some further gains; hence recommending keeping 25-35 percent of the positions.