- USD/CHF focuses on recapturing the crucial resistance of 0.8900 amid a risk-off mood.
- Fed Powell would provide fresh guidance on the interest rate outlook.
- The term of SNB Jordan will be over in the second half of this year.
The USD/CHF pair rises slightly above 0.8850 in Tuesday’s European session as investors turn cautious ahead of the Federal Reserve (Fed) Chair Jerome Powell’s testimony before Congress on Wednesday and the United States Nonfarm Payrolls (NFP) data later this week.
The Swiss Franc asset extends its upside as the US Dollar Index (DXY) rebounds from two-day low around 103.70. Fed Powell's commentary and the February labor market data will provide fresh insights about when the Fed will start reducing interest rates.
The Swiss Franc fails to find buying interest despite the annual Consumer Price Index (CPI) remaining stickier than expectations in February. The monthly CPI rose strongly by 0.6% against 0.2% in January. The monthly pace was significantly higher than required to keep inflation below 2%. The annual CPI at 1.2% was higher than expectations of 1.1% but lower than the prior reading of 1.3%.
Meanwhile, it is announced that the SNB is looking for the successor of Chairman Thomas J. Jordan. The new SNB Chairman will be announced in the second half of this year.
USD/CHF falls while attempting to deliver a breakout of the consolidation formed in a range of 0.8744-0.8898 on a four-hour timeframe. A mild sell-off near the upper end of the consolidation doesn’t indicate a reversal but indicates that US Dollar bulls need more force for a decisive break. The consolidation pattern indicates a sharp volatility contraction. A breakout in the same will result in a volatility expansion, leading to wider ticks and heavy volume.
The 50-period Exponential Moving Average (EMA) near 0.8822 continues to support the US Dollar bulls.
The 14-period Relative Strength Index (RSI) climbs above 60.00. A bullish momentum would emerge if the RSI (14) manages to sustain above the same.
Fresh upside would emerge if the asset breaks above the three-month high around 0.8900, which would unlock upside towards September 20 low at 0.8932 and November 8 low at 0.8976.
On the contrary, a breakdown below February 13 low at 0.8746 would expose the asset to the round-level support of 0.8700, followed by February 1 high around 0.8650.
USD/CHF four-hour chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD: Federal Reserve and Nonfarm Payrolls spell action this week
The EUR/USD pair temporarily reconquered the 1.0700 threshold last week, settling at around that round level. The US Dollar lost its appeal following discouraging United States macroeconomic data indicating tepid growth and persistent inflationary pressures.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold: Strength of $2,300 support is an encouraging sign for bulls
Gold price started last week under heavy bearish pressure and registered its largest one-day loss of the year on Monday. The pair managed to stage a rebound in the second half of the week but closed in negative territory.
Ethereum fees drops to lowest level since October, ETH sustains above $3,200
Ethereum’s high transaction fees has been a sticky issue for the blockchain in the past. This led to Layer 2 chains and scaling solutions developing alternatives for users looking to transact at a lower cost.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.