- USD/CHF has picked strength around 0.8920, following the footprints of the USD Index.
- The downside move in the USD Index has paused for now but is not faded as Fed policymakers have delivered dovish commentary.
- The SNB is expected to raise interest rates further by 25 basis points (bps) to 1.75%.
The USD/CHF pair has attempted a recovery after building a base around 0.8920 in the early European session. The Swiss Franc asset has picked some strength after observing that the US Dollar Index (DXY) has gauged an intermediate support around 102.00.
The downside momentum in the USD Index has paused for now but is not faded as Federal Reserve (Fed) policymakers have delivered dovish commentary for further interest rate action.
Meanwhile, the interest rate decision by the Swiss National Bank (SNB), which will be announced at 7:30 GMT, will be in focus. A poll from Reuters showed that SNB Chairman Thomas J. Jordan will raise interest rates by 25 basis points (bps) to 1.75% as the central bank believes that it is really important to bring Swiss inflation to a level of price stability.
USD/CHF is declining toward its intermediate support plotted from May 12 low around 0.8900 on a four-hour scale. The 50-period Exponential Moving Average (EMA) at 0.974 has been acting as a barricade for the US Dollar bulls.
The Relative Strength Index (RSI) (14) is oscillating in the bearish range of 20.00-60.00, which indicates that each pullback move in the asset has been capitalized as a selling opportunity by the market participants.
Going forward, a breakdown below May 12 low around 0.8900 would expose the Swiss Franc asset to April 13 low at 0.8860 followed by the ultimate support plotted from May 04 low at 0.8820.
In an alternate scenario, an upside move above the psychological resistance of 0.9000 would fade the bearish bias and will drive the asset toward June 06 low at 0.9033 and May 30 high at 0.9084.
USD/CHF four-hour chart
-638230093862774063.png)
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 turns negative near 1.0760
The sudden bout of strength in the Greenback sponsored the resurgence of the selling pressure in the risk complex, dragging EUR/USD to the area of daily lows near 1.0760.
GBP/USD comes under pressure and challenges 1.2500
GBP/USD now rapidly loses momentum and gives away initial gains, returning to the 1.2500 region on the back of the strong comeback of the US Dollar.
Gold retreats from highs on stronger Dollar, yields
XAU/USD trims part of its initial advance in response to the jump in the Dollar's buying interest and the re-emergence of the upside pressure in US yields.
XRP tests support at $0.50 as Ripple joins alliance to work on blockchain recovery
XRP trades around $0.5174 early on Friday, wiping out gains from earlier in the week, as Ripple announced it has joined an alliance to support digital asset recovery alongside Hedera and the Algorand Foundation.
Week ahead – US inflation numbers to shake Fed rate cut bets
Fed rate-cut speculators rest hopes on US inflation data. After dovish BoE, pound traders turn to UK job numbers. Will a strong labor market convince the RBA to hike? More Chinese data on tap amid signs of slow Q2 start.