Swiss Franc: 0.8205 caps losses against US Dollar - UOB

UOB’s Quek Ser Leang highlights that USD/CHF extended gains to 0.8195 before consolidating, with intraday trade now expected between 0.8150 and 0.8195. He sees strong but overbought momentum and says a sustained move to 0.8245 requires a clear break and hold above 0.8205. Maintaining support above 0.8130 is seen as key to preserving the bullish bias.

Bulls need 0.8205 break

"24-HOUR VIEW: After USD rose more than we expected last Friday, we highlighted the following yesterday: “We underestimated the upward momentum, as USD rose more than expected to 0.8170 before closing on a firm note at 0.8161 (+0.44%). Conditions remain overbought, but strong upward momentum suggests USD could test 0.8185 today. Any further advance is highly unlikely to reach the significant resistance at 0.8205. To keep the momentum going, USD must hold above 0.8140, with minor support at 0.8150.” Our assessments turned out to be correct, as after rising to a high of 0.8195, USD pulled back to close modestly higher at 0.8171 (+0.12%). The pullback amid slowing momentum suggests that instead of continuing to advance today, USD is more likely to consolidate between 0.8150 and 0.8195."

"1-3 WEEKS VIEW: We turned positive on USD late last week (see annotations in the chart below). Yesterday (14 Sep, spot at 0.8165), we highlighted that “while upward momentum continues to build, it is currently unclear whether it is sufficient for USD to rise to the significant resistance at 0.8205.” USD subsequently rose to 0.8195, but while momentum continues to build, given the overbought conditions, USD must break and hold above 0.8205 before a move to 0.8245 can be expected. To keep the momentum going, USD must not break below 0.8130 (‘strong support’ level was at 0.8110 yesterday)."

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