USDCHF (also shown as USD/CHF and called as ‘US Dollar Swiss Franc’ pair) is a currency pair: the US Dollar paired with the Swiss Franc. CHF and USD are both considered majors, meaning that these currencies are commonly used in international trade as well as daily transactions. As a currency pair, USDCHF is a favorite investment and trading instrument for millions of people in the world.

The value of USD/CHF indicates how many CHF you need to purchase one USD. For example, if USD/CHF is at 0.95 it means you need 95 Francs to buy 100 US Dollars. USDCHF is the sixth most traded currency pair in the world, where the top of the list is dominated by EURUSD, USDJPY and GBPUSD. As of 2021, USDCHF represents around 4.5% all daily transactions in the foreign exchange market.

In this pair, USD is the base currency while CHF is the quote currency. This pair is often shown up to 5th decimal. E.g., 0.90453. In this example, one pip move for USDCHF is a 0.0001 move in either direction. If USD/CHF moved from 0.90453 to 0.90454, that means a one-pip move.

In most cases with currency pairs, whatever impacts a currency impacts its pair. Thus, factors that are likely to impact the price of USDCHF are as follows:

Role of USD:
US Dollar is the most traded and widely-used currency in the world. Other currencies and assets are paired with USD in order to measure their competitive value accurately. Naturally, anything that would impact the USD will impact any USD pair too. FED decisions: The Federal Open Market Committee (FOMC) of the United States Federal Reserve System (FED) has a large impact on key monetary policy decisions in the US. Meeting bi-monthly, the committee makes decisions on interest rates and money supply policy. As an example, higher interest rates in the US would decrease the supply of USD in the market, because investors would choose to hold on to USD.

Employment Data: On the first Friday of every month, the US Department of Labor's Bureau of Statistics releases employment data for the previous month. The report is widely known as NFP (nonfarm payrolls) or 'US jobs report'. It is an influential statistic on the state of the labor market in America, and it has a direct influence on USDCHF value.

Geopolitical tensions: Political tension regarding the foreign affairs of the US might impact the USDCHF price indirectly. In times of political uncertainty, investors move away from a particular currency or a currency pair. They sometimes turn to alternatives or to ‘safe havens’ such as gold. Thus, any economic, political or financial development that impacts CHF or USD would definitely impact USD/CHF as well.

Role of CHF:
Switzerland has a healthy and stable economy. Monetary policies are governed by the central bank of Switzerland, the Swiss National Bank. The Swiss Franc (also called Swissie or Swissy) is the currency of Switzerland, Lichtenstein, and the Italian municipality of Campione d'Italia (a small enclave in the south).

It is crucial to note that Switzerland's per capita GDP is among the highest in the world. The country’s economy benefits from a highly developed service sector, led by financial services industry, and a sophisticated high-tech manufacturing industry.

Most Swiss economic practices conform to those of the surrounding European Union, though Switzerland is not in the Eurozone. Switzerland’s economy is seen as a safe haven and is rated as the safest economy in the world. The economy is dependent on foreign investments. The unemployment rate is estimated at 3% as of 2021.

Clearly, supply and demand for Swisse determines the exchange rate of the pound. If demand for CHF goes up, then its price will too. Strong economies have strong currencies because other countries want to invest there. Their governments are seen ‘less likely to fail’ in terms of investment.

Foreign exchange and CFD markets are notoriously volatile and unpredictable. Nobody can come up with a universal strategy for any product. And that is part of its charm. Although the volatility is what attracts the investors, new traders may find it hard to adjust their trading strategy or keep up with the fast-paced nature of the markets.

Considering that approximately 28% of all offshore funds are banked in Switzerland, you can realize just how big the banking industry is in Switzerland. In fact, in 2011, the European Union stated that the ‘Franc is a threat to the economy’ and this caused the Franc to plunge.

Besides the general advice of catching trends via support and resistance levels, one should remember that trading USD/CHF is closely linked to EUR/CHF and any other EUR pair due to the country’s intricate relationship with the Eurozone. That is why it is important to keep track of the other major pairs that include EUR if you wish to trade USD/CHF accurately.

As always, you should put protective stop-loss and adequate take-profit measures in play.

USDCHF is a popular instrument in the currency market. You can start trading USD/CHF immediately with a free Blue Suisse account. If you are not ready, you can practice trading with a demo account.

Follow these easy steps to start trading gold:

Step 1: Register by filling out the form on Blue Suisse website here.
• If you want to try our platforms first, you can start with a demo account instead.

Step 2: Finish your application by confirming your identity. We will ask for a proof of identity and a proof of address.

Step 3: Make your first deposit via secure methods, including credit card, bank transfer or others.

Step 4: Access a trading platform. Either install the software or access TradeMaster’s web version via your browser.

Step 5: Look for USD/CHF using the search function and start trading immediately.