CHFJPY refers to the Swiss Franc and the Japanese Yen respectively. This is a fascinating currency pairing because it combines two of the world's most powerful economies, both of which are well-known for their resilience and attractive investment characteristics.
This pair is especially appealing for Forex traders because it is less commonly traded than other currency pairs and consequently, there are often substantial price movements in the market.
In the last few years, this pairing has been trending upwards as investors have sought to diversify their portfolios away from the US Dollar and into other currencies which appear less volatile. As such, CHFJPY is an ideal pair for traders who are seeking protection from USD volatility, looking for a higher degree of predictability but still allowing for an attractive level of volatility.
Both the Franc and the Yen have historically been known as "Safe Haven" currencies. A safe-haven asset is an asset that is anticipated to preserve or increase in value in the face of major economic downturns and uncertainty. As a result, the currencies are typically bought in times of global economic and financial insecurity while local stock markets are sold off.
Switzerlands political stability, well-established financial sector, trade surplus, and low unemployment rates has earned its currency the moniker of Safe Haven. Whereas the Yen has earned it's Safe Haven label pursuant to Japan's positive net foreign asset position (these assets are sold in a financial crisis thus increasing the demand for Yen), and zero to negative level interest rates making the Yen an attractive currency for borrowing.
Whilst economic uncertainty is a prominent attraction for investors in CHFJPY, domestic economic developments also have a significant impact on the value of both currencies. Be sure to look out for announcements relating to inflation, GDP, unemployment, and interest rates.
Commonly known as the 'Swissie' by foreign currency traders, the CHF is the seventh most traded currency pair in the world. The CHF is a significant pillar of the global financial system as a safe-haven investment where market participants may turn to when the markets are volatile. The country's role as the de-facto banking capital of the world, as well as its status as one of Europe's largest trading partners, has established a dependable demand for the CHF in global capital markets.
Japan is the world's third-largest economy, but this was not always the case. Japan went through an "economic miracle" between WWII and the end of the Cold War, a time of rapid economic development. What remains is a strong domestic market, vast natural resources and an impressive technological sector that is the envy of other nations. The Yen is the third most popular currency in global markets, trailing only behind the US dollar and the Euro, it is a currency that appears in many pairs, indicating strong demand.
The Swiss France and Japanese Yen exchange rate is depicted by the symbol CHFJPY. The pair entails two safe haven economies creating a strong connection between the two currencies. The CHF is at the base of the pair meaning that this is what traders quote against the JPY.
CHFJPY is a minor pair so it is less liquid than the majors, however there is still a decent level of liquidity in this market and plenty of opportunity for both scalpers and swing traders.
CHFJPY is available for trading 24/5, however the pair is generally at its busiest between 15:00 and 19:00 GMT+2 (Server Time) during the intersection between London and New York Markets trading hours.
When you are buying CHFJPY, you are of the opinion that the price of the CHF will strengthen against the JPY. The reverse is true for a sell trade.
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