USD/CHF Price Analysis: Test of a trendline breakout around 0.9230 is in action

USD/CHF is struggling to find direction as volatility has squeezed amid a long weekend in the United States.
Fed minutes will provide a detailed explanation behind an interest rate hike of 25bps.
The Swiss Franc asset is testing the breakout of the downward-sloping trendline plotted from 0.9600.

Sagar Dua FXStreet

The USD/CHF pair is oscillating in a narrow range around 0.9230 in the early Asian session. The Swiss Franc asset has turned sideways following the footprints of the US Dollar Index (DXY). The USD Index failed to gauge a decisive movement amid less trading activity due to an elongated weekend in the United States amid a holiday on Monday due to Presidents’ Day.

Investors are shifting their focus towards the release of the preliminary S&P PMI (Feb) figures and the Federal Reserve (Fed) minutes. The minutes from the Fed will provide a detailed explanation of hiking interest rates by 25 basis points (bps) in the February monetary policy meeting.

Meanwhile, the commentary from Swiss National Bank (SNB) Vice Chairman Martin Schlegel failed to provide strength to the Swiss franc. SNB Schlegel cited the central bank is "still willing" to be active in the foreign currency markets in pursuing its goal of price stability.

USD/CHF is testing the breakout of the downward-sloping trendline placed from November 21 high around 0.9600 on a four-hour scale. Usually, a test of a trendline breakout with an absence of solid downside pressure indicates the strength of bulls and prepares a platform for a confident upside move ahead.

The Swiss Franc asset is employing efforts to shift its auction above the 200-period Exponential Moving Average (EMA) at 0.9245.

Meanwhile, the Relative Strength Index (RSI) (14) has failed to sustain in the bullish range of 60.00-80.00. A bullish momentum will be triggered if the momentum oscillator manages to reclaim the 60.00-80.00 range.

For a fresh upside, the Swiss Franc asset needs to deliver a confident break above February 6 high around 0.9290, which will drive the asset towards January 12 high at 0.9363 followed by January 6 high at 0.9410.

In an alternate scenario, a breakdown below February 9 low at 0.9161 will drag the asset towards the round-level support at 0.9100. A slippage below the latter will drag the asset towards February low at 0.9059.

USD/CHF four-hour chart

USD/CHF

Overview
Today last price	0.9235
Today Daily Change	-0.0010
Today Daily Change %	-0.11
Today daily open	0.9245

Trends
Daily SMA20	0.9213
Daily SMA50	0.925
Daily SMA100	0.9493
Daily SMA200	0.9586

Levels
Previous Daily High	0.9332
Previous Daily Low	0.9243
Previous Weekly High	0.9332
Previous Weekly Low	0.9138
Previous Monthly High	0.941
Previous Monthly Low	0.9085
Daily Fibonacci 38.2%	0.9277
Daily Fibonacci 61.8%	0.9298
Daily Pivot Point S1	0.9215
Daily Pivot Point S2	0.9184
Daily Pivot Point S3	0.9126
Daily Pivot Point R1	0.9304
Daily Pivot Point R2	0.9363
Daily Pivot Point R3	0.9393

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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