GBP/CHF is a chart with uncertain dynamics and very high volatility. After dropping to a record low at the end of September, we saw a recovery, and yet the resistance line is still down. So a slight downtrend seems saved. The support line is directed upwards, but it is repeatedly tested and shifted.
The UK economy remains under pressure amid extremely high inflation of 10.5-11% and falling consumer activity. The Bank of England continues to raise the rate to stabilize inflation, but this is not enough, as the economy, weakened by the pandemic and Brexit consequences, is faced with rising resource prices and rising costs as a result of the imposition of sanctions against Russia. The latest macroeconomic reports are a drop in business activity in the construction sector, which can be considered a sign of a large-scale economic crisis. Being a risky asset, the pound is considered today not the most attractive asset against the background of the global recession.
The Swiss franc, on the contrary, is receiving support as the safest European asset. Despite rising unemployment for the fourth month in a row, the 2.2% rate is considered more than acceptable and well below the European average.
Tomorrow the UK GDP report will be in the spotlight, and next week there will be reports on inflation, unemployment in the UK, retail sales and other important reports. Watching the chart, we predict an upward movement in the near future. The Stochastic Oscillator also indicates the effectiveness of the deals to BUY. However, in the long run, investing in the pound can be risky.
