USD/CHF Price Analysis: Rebounds from 0.8600 amid cautious market mood

USD/CHF climbs to near 0.8600 as US Dollar recovers amid dismal market mood.
Investors see first rate-cut from the Fed in May now against prior expectations for March.
The Fed is expected to maintain status-quo for fourth straight time.

Sagar Dua FXStreet

The USD/CHF pair discovers buying interest near the round-level support of 0.8600. The Swiss Franc pair bounces as investors rush for safe-haven assets amid volatility ahead of the Federal Reserve (Fed) monetary policy and deepening Middle East tensions.

S&P500 futures remains subdued in the European session, which indicates that investors have sidelined ahead of the Fed policy outcome. The US Dollar Index (DXY) jumps to near the crucial resistance of 103.70. 10-year US Treasury yields have dropped to near 4.10%.

Investors see the Fed keeping interest rates unchanged in the range of 5.25-5.50% for the fourth time in a row. Meanwhile, expectations for rate-cuts by the Fed have shifted to May’s monetary policy meeting from March as policymakers have been warning about the consequences of premature rate-reduction decision that could uplift core price pressures and dampen efforts yet made in bringing them down to near 3.9%.

USD/CHF struggles to advance above the 38.2% Fibonacci retracement (plotted from 3 October 2023 high at 0.9244 to 28 December 2023 low at 0.8333) at 0.8680. The 20-period Exponential Moving Average (EMA) near 0.8620 is providing support to the US Dollar bulls.

The 14-period Relative Strength Index (RSI) has shifted into 40.00-60.00 range from the bearish range of 20.00-40.00. Fresh buying momentum would emerge if the asset will shift into the bullish range of 60.00-80.00.

Going forward, a decisive break above intraday high of 0.8652 would drive the asset towards the round-level resistance of 0.8700 and January 23 high of 0.8728.

In an alternate scenario, a downside move below the psychological support of 0.8500 will expose the asset to January 5 low at 0.8455, followed by 27 December 2023 low at 0.8408.

USD/CHF daily chart

USD/CHF

Overview
Today last price	0.8625
Today Daily Change	-0.0016
Today Daily Change %	-0.19
Today daily open	0.8641

Trends
Daily SMA20	0.8575
Daily SMA50	0.8646
Daily SMA100	0.8833
Daily SMA200	0.8856

Levels
Previous Daily High	0.8685
Previous Daily Low	0.8616
Previous Weekly High	0.8728
Previous Weekly Low	0.8607
Previous Monthly High	0.8821
Previous Monthly Low	0.8333
Daily Fibonacci 38.2%	0.8643
Daily Fibonacci 61.8%	0.8659
Daily Pivot Point S1	0.861
Daily Pivot Point S2	0.8579
Daily Pivot Point S3	0.8541
Daily Pivot Point R1	0.8678
Daily Pivot Point R2	0.8716
Daily Pivot Point R3	0.8747

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.

AUD/USD sticks to neutral bias above 0.7100 amid cautious markets

AUD/USD holds steady above 0.7100 in the Asian session on Monday as the US Dollar stalls its modest pullback from the highest level since late July amid persistent geopolitical uncertainties. The PBOC status quo on Loan Prime Rates also weighs on the Aussie. However, bets on another RBA rate hike continue to underpin the Australian Dollar ahead of the Trump-Xi Summit.

USD/JPY eases below 157.00 amid looming intervention risks

USD/JPY is easing back below 157.00 in Asia on Monday, undermined by modest Japanese Yen strength amid looming intervention risks after Friday's BoJ rate check. A Japanese holiday also keeps traders on edge amid escalating geopolitical tensions between Russia and Ukraine and in the Middle East. As a result, the US Dollar pauses its pullback, limiting the pair's downside.

Gold feeling the heat as geopolitics is back in play

Gold snaps recent recovery from six-week lows on Monday after facing rejection at $4,400. US Dollar stalls correction amid renewed geopolitical jitters, ahead of the Trump-Xi meeting. Gold’s daily technical setup paints a mixed picture, with a neutral daily RSI.

Solana extends rally as tokenized equity holders hit a record

Solana (SOL) extends its gains, trading above $111.70 after rallying nearly 12% last week. The bullish price action comes as growth in Solana’s tokenized equity ecosystem reaches a new milestone. Meanwhile, improving momentum indicators and strengthening institutional demand point to further gains in SOL.

Economics week ahead

This week is light on the domestic data front, with focus on Thursday's new home sales report. We expect sales to partially recover in August, rising 2.6% to a 623K pace after a sharp decline in July. Higher mortgage rates continue to weigh on affordability and demand, though builder incentives remained in place and conditions did not worsen materially during the month.

BoJ Recap: Not as hawkish as expected

The Bank of Japan (BoJ) raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks.