EUR/CHF rises more than a hundred pips and breaks above 1.0500

• Euro jumps across the board following ECB meeting.
• EUR/CHF heads for biggest daily gain in years.

The EUR/CHF gained a hundred pips following the European Central Bank meeting as the euro strengthened across the board. The cross opened the day under 1.0400 and recently hit a fresh high at 1.0514, the highest level in two months.

The ECB kept interest rates unchanged as expected. The statement contained few changes from the December meeting. The positive news for the euro started with Lagarde’s press conference. She didn't push back against market pricing of rate hikes in 2022, sending Eurozone bond yields to the upside.

Later, reports mentioned the ECB policymakers see a policy change at the March meeting if inflation does ease. According to the report they see a faster pace of tapering the Asset Purchase Programme. Those reports helped the euro extends gains across the board.

Eurozone government bond yields are sharply higher on Thursday. The 10-german yield reached 0.159%, the highest level since March 2019. The moves in the European bond market also triggered volatility in currencies and commodities. Gold and silver tumbled and then rebounded sharply. Stocks in the US are in red.

The EUR/CHF is testing levels above 1.0500. A daily close above should point to further gains. The next resistance stands at 1.0535, followed by 1.0570. On the flip side, now 1.0445 is the immediate support.

Technical levels