USD/CHF Price Analysis: Bulls approach 0.8800 on mixed Swiss Inflation data, US PMI eyed
- USD/CHF remains on the front foot for the sixth consecutive day, clings to mild gains of late.
- Swiss CPI slides to -0.1% MoM, 1.6% YoY in July.
- Clear upside break of 21-DMA, bullish MACD signals keep buyers hopeful.
- May’s bottom lures bulls but 0.8880 is a tough nut to crack for bulls.
USD/CHF sticks to mild gains around 0.8785-90 as it justifies downbeat Swiss Inflation data for July heading into Thursday’s European session. In doing so, the Swiss Franc (CHF) pair also takes clues from the firmer US Dollar, as well as a cautious mood, ahead of the US ISM Services PMI.
That said, the Swiss Consumer Price Index (CPI) matches market forecasts by rising 1.6% YoY in July versus 1.7% previous readings. The monthly readings, however, edge lower to -0.1% from 0.1% prior and -0.2% market forecasts.
Technically, the successful break of the 21-DMA and bullish MACD signals keep USD/CHF buyers hopeful of poking May’s bottom of around 0.8820.
However, a convergence of the 50-DMA and a downward-sloping resistance line from May 31, close to 0.8880 by the press time, appears a tough nut to crack for the Swiss Franc (CHF) pair buyers.
Following that, June’s bottom surrounding 0.8900 will act as the last defense of the sellers.
On the contrary, a daily closing beneath the 21-DMA level of 0.8706 needs validation from the 0.8700 round figure encompassing the late July swing high.
Should the USD/CHF bears dominate past 0.8700, a 12-day-long horizontal support zone near 0.8560 and a six-month-old descending support line, near 0.8535 as we write, will challenge the sellers.
USD/CHF: Daily chart
Trend: Further upside expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
