USD/CHF finds resistance at 0.8100 but stands tall awaiting Fed’s Powell

US Dollar finds resistance at 0.8100 but remains steady above previous weekly highs.
The US Dollar strengthens across the board as the market holds its breath ahead of Fed Powell's speech.
Weak Swiss data has added bearish pressure on the Swiss Franc this week.

Guillermo Alcala FXStreet

The US Dollar is trimming daily gains against the Swiss Franc on Friday. The pair’s rebound from Thursday’s lows at 0.8025 has been capped at 0.8100 earlier today, but remains above previous weekly highs, at 0.8090, ahead of the widely expected speech by Fed Chair Jerome Powell at the Jackson Hole Symposium.

Traders will be looking for signals of any change in Powell’s rhetoric after the Nonfarm Payrolls shock rattled markets earlier in the month, and the soft CPI released shortly afterwards prompted investors to ramp up bets of immediate monetary easing.

Strong US data raises concerns of a hawkish Powell

More recent data, however, revealed a significant increase in factory prices and strong manufacturing and services activity, pointing to a resilient economy, which has triggered some doubts about the tone of Chairman Powell’s speech.

Fed speakers left all possibilities open on Thursday, Cleveland President Hammack showed concern about the inflationary impact of tariffs, while Boston Fed President Collins signalled openness to a rate cut in September amid risks of a weakening labour market.

In Switzerland, the calendar was light this week, but industrial production figures released earlier showed that factory activity declined and that the trade surplus narrowed, amid a 2.7% decline in exports. These data add pressure on the SNB to ease interest rates into negative levels, and have weighed heavily on the CHF.

Economic Indicator

Fed's Chair Powell speech

Jerome H. Powell took office as a member of the Board of Governors of the Federal Reserve System on May 25, 2012, to fill an unexpired term. On November 2, 2017, President Donald Trump nominated Powell to serve as the next Chairman of the Federal Reserve. Powell assumed office as Chair on February 5, 2018.

EUR/USD climbs to daily highs near 1.1820

EUR/USD now picks up pace and advances to the area of daily peaks north of the 1.1800 barrier at the end of the week. The pair’s decent move higher comes against the backdrop of a generalised lack of direction in the FX galaxy and the mild offered stance in the US Dollar.

GBP/USD trims losses, retests 1.3460

After briefly challenging its key 200-day SMA near 1.3440, GBP/USD now manages to regain some balance and revisit the 1.3460 zone on Friday. Cable’s pullback comes as the selling pressure on the Greenback gathers traction, reigniting some recovery in the risk-linked space.

Gold flirts with four-week highs past $5,200

Gold extends its rebound, climbing for a third consecutive session and pushing back above the $5,200 mark per troy ounce on Friday. The move higher continues to draw support from lingering geopolitical tensions and the ongoing uncertainty surrounding US trade policy, both of which are keeping safe-haven demand firmly in play.

Bitcoin, Ethereum and Ripple consolidate with short-term cautious bullish bias

Bitcoin, Ethereum and Ripple are consolidating near key technical areas on Friday, showing mild signs of stabilization after recent volatility. BTC holds above $67,000 despite mild losses so far this week, while ETH hovers around $2,000 after a rejection near its upper consolidation boundary.

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Early Saturday, United States (US) President Donald Trump announced that the US had begun “major combat operations” in Iran, following Israel’s pre-emptive missile attacks against Tehran.

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