Risk aversion has dragged risk assets like GBP lower this week while protected havens like CHF have gained pips.

Can the tides turn for GBP/CHF after the U.K.’s retail sales release?

I don’t know when you’ve read Pippo’s June U.K. Retail Sales Event Guide, however it’s possible that we’ll see better-than-expected retail activity for the third month in a row tomorrow.

GBP/CHF 15-Minute Forex Chart by TV

Strong retail numbers would give the Bank of England (BOE) more room to lift its rates of interest if needed. The increased probability of one other BOE rate hike could then support GBP against major counterparts like CHF.

As you’ll be able to see, GBP/CHF is already finding buyers around this week’s lows. Coincidentally, the move to the 1.1070 low also represents half of GBP/CHF’s every day average volatility.

GBP/CHF could turn higher from its 1.1070 support zone and perhaps even complete a Double Bottom pattern breakout if the U.K.’s retail data surprise to the upside.

I’m the 1.1100 “neckline” area as an initial profit goal. In any case, it’s not too removed from the 1.1120 Pivot Point line and the 100 SMA on the chart.

Additional long positions might rely upon overall risk sentiment though. The U.S. is printing its initial jobless claims and Philly Fed manufacturing numbers later today.

If today’s market themes encourage risk-taking, then I’ll also consider playing a possible upside breakout and adding long positions above the Pivot Point line.

What do you’re thinking that? Will GBP/CHF see a bullish reversal before the week ends?

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