USD/CHF Price Analysis: Expect a rally above 0.9070 as Fed to raise rates further
|- USD/CHF has shown a recovery after building a base around 0.9050 as the Fed is expected to raise interest rates further.
- A deal for raising the US debt-ceiling has been agreed upon by Republican leaders at the cost of a decline in the spending budget.
- USD/CHF is anticipated to deliver a perpendicular upside after a break above the immediate resistance plotted at 0.9073.
The USD/CHF pair has attempted a recovery move after building a base around 0.9050 in the early Toyo session. The Swiss Franc asset has been supported by solid bets for more interest rate hikes by the Federal Reserve (Fed). Rising consumption expenditure by United States households is showing that the stream could heat up inflationary pressures further.
S&P500 futures are holding significant gains freshly added in early Asia. A deal for raising the US debt-ceiling has been agreed upon by Republican leaders at the cost of a decline in the spending budget and will be moved to Congress, as announced by US President Joe Biden.
The US Dollar Index (DXY) is struggling in extending its recovery above 104.30 as US markets will be closed on Monday due to Memorial Day. Therefore, a less-volatile action is widely anticipated.
USD/CHF has comfortably shifted into a markup phase after delivering a breakout of the Wyckoff Accumulation pattern formed on a four-hour scale. The Swiss franc asset is expected to display wider bullish ticks and heavy volume as bulls remain solid in the markup phase. Upward-sloping 50-period Exponential Moving Average (EMA) at 0.9017 is providing support to the US Dollar bulls.
A confident break into the bullish range of 60.00-80.00 by the Relative Strength Index (RSI) would strengthen US Dollar bulls further.
Going forward, a decisive break above the immediate resistance plotted on May 25 high at 0.9073 will drive the asset toward the round-level resistance of 0.9100 followed by March 28 low at 0.9137.
In an alternate scenario, a downside move below May 16 low at 0.8929 will drag the asset toward April 14 low at 0.8867. A slippage below April 14 low will further drag the asset toward the Spring formation around May 04 low at 0.8820.
USD/CHF four-hour chart
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