USD/CHF finds support at the 100-day SMA, correction in the horizon

The USD/CHF rebounded at the 0.8900 area, rising to a high towards 0.8935, seeing 0.15% gains.
The CHF was the best-performing currency in Thursday, and the pair lost nearly 0.85%.
The economic calendar has nothing relevant to offer, and focus shifts to the Middle East.

Patricio Martín FXStreet

On Friday, the USD/CHF sellers seemed to be consolidating their gains, and the pair found support at the 100-day Simple Moving Average (SMA) at 0.8900, rising to a high near 0.8935 and then settling ar 0.8915.

On the USD side, it struggles to gather momentum and trades soft against its rivals. That being said, as all eyes will be set on the Middle East in the conflict between Israel and Palestine, the green currency may find demand on safe-haven flows. For the next week, the highlight will be the S&P Manufacturing PMI from the US from October, where investors will get a clearer outlook from the US economy. This week, Industrial Production and Retail Sales from September came in higher than expected, and the Federal Reserve’s (Fed) Beige book report described the economy as “stable”.

In addition, Chair Powell highlighted on Thursday that higher bond yields, contributing to tighter financial conditions, will be considered for the next decisions. However, he still opened the door for further tightening, and the bank will proceed “carefully”.

USD/CHF Levels to watch

Upon evaluating the daily chart, a neutral to bearish outlook is seen, with the balance starting to lean in favour of the bears. However, a healthy technical correction shouldn’t be ruled out by traders.

The Relative Strength Index (RSI) maintains a negative slope in the bearish territory, while the Moving Average Convergence (MACD) histogram presents increasing red bars. Those indicators stand near oversold territory, favouring the case of an upward correction in the next sessions. Additionally, the pair is above the 20-day Simple Moving Average (SMA), below the 200-day SMA, but above the 100-day SMA, suggesting that the bears still have some work to do to confirm a bearish bias.

Support levels: 0.8900 (100-day SMA), 0.8870, 0.8850.

Resistance levels: 0.890,0.9015 (200-day SMA), 0.9040.

USD/CHF Daily Chart

USD/CHF

Overview
Today last price	0.8912
Today Daily Change	-0.0002
Today Daily Change %	-0.02
Today daily open	0.8914

Trends
Daily SMA20	0.9089
Daily SMA50	0.8957
Daily SMA100	0.8903
Daily SMA200	0.9016

Levels
Previous Daily High	0.9002
Previous Daily Low	0.8909
Previous Weekly High	0.9124
Previous Weekly Low	0.8987
Previous Monthly High	0.9225
Previous Monthly Low	0.8795
Daily Fibonacci 38.2%	0.8944
Daily Fibonacci 61.8%	0.8966
Daily Pivot Point S1	0.8881
Daily Pivot Point S2	0.8849
Daily Pivot Point S3	0.8788
Daily Pivot Point R1	0.8974
Daily Pivot Point R2	0.9034
Daily Pivot Point R3	0.9067

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

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