USD/CHF trades just below 200 DMA amid sluggish USD


  • USD/CHF drops to a fresh multi-month low amid the emergence of fresh USD selling.
  • Diminishing odds for a later Fed rate hike in September continue to weigh on the USD.
  • The risk-on mood undermines the safe-haven CHF and helps limit any further downside.

The USD/CHF pair witnesses selling for the fourth successive day and drops to a four-month low during the first half of the European session. Spot prices, however, show some resilience below the 0.9400 mark and quickly recover around 20 pips in the last hour.

The US dollar struggles to capitalize on the previous day's bounce and remains sluggish near its lowest level since late June touched in the aftermath of softer US consumer inflation figures on Wednesday. This, in turn, exerts some downward pressure on the USD/CHF pair, though sustained weakness below the 0.9400 mark is needed to confirm a bearish breakdown below a technically significant 200-day SMA.

The weaker-than-expected US CPI report forced investors to scale back expectations for a larger 75 bps Fed rate hike move in September. That said, the overnight hawkish comments by Fed officials should act as a tailwind for the greenback. Apart from this, a generally positive tone around the equity markets seems to undermine the safe-haven swiss franc and limit losses for the USD/CHF pair, at least for now.

The Fed, meanwhile, is still expected to hike interest rates by 50 bps points at the September policy meeting. This, in turn, supports prospects for the emergence of some dip-buying around the USD and further warrants some caution for aggressive bearish traders. Market participants now look forward to the US Producer Price Index (PPI) for a fresh impetus later during the early North American session.

Technical levels to watch

USD/CHF

Overview
Today last price 0.941
Today Daily Change -0.0020
Today Daily Change % -0.21
Today daily open 0.943
 
Trends
Daily SMA20 0.9619
Daily SMA50 0.9675
Daily SMA100 0.9631
Daily SMA200 0.9429
 
Levels
Previous Daily High 0.9545
Previous Daily Low 0.9394
Previous Weekly High 0.9652
Previous Weekly Low 0.9471
Previous Monthly High 0.9886
Previous Monthly Low 0.9502
Daily Fibonacci 38.2% 0.9452
Daily Fibonacci 61.8% 0.9487
Daily Pivot Point S1 0.9368
Daily Pivot Point S2 0.9305
Daily Pivot Point S3 0.9216
Daily Pivot Point R1 0.9519
Daily Pivot Point R2 0.9608
Daily Pivot Point R3 0.9671

 

 

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