USD/CHF Price Analysis: Falls back to 0.8900 amid fears of SNB’s intervention

USD/CHF drops back to 0.8900 as Swiss Franc strengthens amid fears of SNB’s stealth intervention plans.
A weak Swiss Franc had made Swiss exports competitive in the global market.
The US Dollar bounces back as investors turn cautious ahead of the US NFP.

Sagar Dua FXStreet

The USD/CHF pair retreats while attempting to extend recovery above the immediate resistance of 0.8950 on Thursday. The Swiss Franc asset drops as the Swiss Franc strengthens amid growing speculation that the Swiss National Bank (SNB) will intervene in the currency market to boost the Swiss Franc’s demand.

SNB policymakers worry that Swiss exports have become competitive due to weak currency, which could prompt upside risks to inflation. On the economic front, the monthly Swiss Unemployment Rate for May came in at 2.3%, matching estimates and the prior release.

Meanwhile, the US Dollar (USD) recovers intraday losses amid uncertainty ahead of the United States (US) Nonfarm Payrolls (NFP) data for May, which will be published on Friday. The US NFP is estimated to report that the hiring process remains robust as fresh payrolls were 185K, higher than the prior release of 175K. The Unemployment Rate is expected to remain steady at 3.9%.

Investors will also focus on the Average Hourly Earnings data, which gauges wage growth, that has remained a major driver to persistent price pressures. Annual Average Hourly Earnings are forecasted to have grown steadily by 3.9%.

Temporarily, the USD/CHF pair finds support near the horizontal support plotted from the February 14 high at 0.8886. Earlier, the Swiss Franc asset weakened after breaking below the horizontal support marked from April 5 near 0.9000, which has become a major resistance for the US Dollar bulls.

The overall trend is bearish as the 20-day and 50-day Exponential Moving Averages (EMAs) appear to deliver a bear cross near 0.9035.

The 14-period Relative Strength Index (RSI) shifts into the bearish range of 20.00-60.00 from the bullish range of 40.00-80.00, indicating a bearish reversal.

More downside would appear if the asset breaks below June 4 low of 0.8900, which will open room for the March 21 low at 0.8840 and the round-level support of 0.8800.

On the flip side, a recovery move above the psychological resistance of 0.9000 will drive the asset towards the June 3 high at 0.9036, followed by the May 28 low at 0.9086.

USD/CHF daily chart

USD/CHF

Overview
Today last price	0.8912
Today Daily Change	-0.0023
Today Daily Change %	-0.26
Today daily open	0.8935

Trends
Daily SMA20	0.9068
Daily SMA50	0.9082
Daily SMA100	0.8935
Daily SMA200	0.8891

Levels
Previous Daily High	0.8949
Previous Daily Low	0.8897
Previous Weekly High	0.9154
Previous Weekly Low	0.9002
Previous Monthly High	0.9225
Previous Monthly Low	0.8988
Daily Fibonacci 38.2%	0.8929
Daily Fibonacci 61.8%	0.8917
Daily Pivot Point S1	0.8905
Daily Pivot Point S2	0.8876
Daily Pivot Point S3	0.8854
Daily Pivot Point R1	0.8957
Daily Pivot Point R2	0.8979
Daily Pivot Point R3	0.9009

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.

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