USD/CHF Price Analysis: Aims to recapture 0.9080 despite subdued US Dollar Index
- USD/CHF is looking to recapture the immediate resistance of 0.9080 despite the subdued USD Index.
- The Swiss Franc bulls witnessed immense selling pressure on Tuesday despite the release of upbeat Q1 GDP.
- USD/CHF is demonstrating a consolidation phase after delivering a breakout of the Wyckoff Accumulation pattern.
The USD/CHF pair has turned sideways around 0.9060 in the early Asian session after a V-shape recovery. The Swiss Franc asset is expected to recapture the crucial resistance of 0.9080 despite a subdued performance by the US Dollar Index (DXY).
Strength in the USD/CHF pair despite the sluggish USD index indicates that the Swiss Franc bulls are also weak. The Swiss Franc bulls witnessed immense selling pressure on Tuesday despite the release of upbeat Q1 Gross Domestic Product (GDP) data. Annual GDP matched expectations at 0.6% while quarterly GDP expanded by 0.3% while the street was anticipating an expansion of 0.1%.
Sheer volatility is anticipated from the US Dollar ahead of the release of the United States Automatic Data Processing (ADP) Employment data will be keenly watched. As per the consensus, the US economy added 170K jobs in May, lower than the prior addition of 296K. Later on Friday, US Nonfarm Payrolls (NFP) will release, which will provide comprehensive information about the US labor market.
USD/CHF is demonstrating a consolidation phase after delivering a breakout of the Wyckoff Accumulation pattern formed on a four-hour scale. Broadly, the Swiss franc asset is expected to display wider bullish ticks and heavy volume as bulls remain solid in the markup phase.
Currently, Relative Strength Index (RSI) (14) is oscillating in the 40.00-60.00 range, which indicates a lackluster performance. A confident break into the bullish range of 60.00-80.00 would strengthen US Dollar bulls.
Going forward, a decisive break above the immediate resistance plotted on May 30 high at 0.9084 will drive the asset toward March 28 low at 0.9137 followed by the round-level resistance of 0.9200.
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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Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
