USD/CHF reverses from monthly highs and tumbles to 0.9130 on ECB story
- Positive comments regain economic outlook from ECB officials send EUR and CHF higher.
- USD/CHF finds again resistance at the 0.9200 area and retreats.
The USD/CHF pair turned to the downside after positive comments from European Central Bank official about the economic outlook for the region ahead of Thursday’s meeting. The pair dropped from 0.9180 to 0.9134, reaching a two-day low and retreating further after hitting on Tuesday 0.9200 for the first time since early August.
ECB on the radar
Ahead of the ECB meeting and following a report from Bloomberg suggesting ECB board members consider more stimulus would be unnecessary at the current economic stance, the USD/CHF is posting the first considerable daily loss since late August.
On Tuesday, the pair posted the highest daily close in a month. The rally lost strength around 0.9200 and then corrected lower. The US dollar weakened across the board with the EUR/USD rally and kept it gains only versus the Japanese yen.
The recovery in Wall Street added negative pressure to the US dollar, the DXY is falling from monthly highs, but remain above 93.00.
USD/CHF continues to limited by 0.9200
The area around 0.9200 is still the critical resistance area. As long as USD/CHF holds below, the upside would be limited. A daily close above would clear the way to more gains, targeting the 55-day moving average at 0.9230 initially and then 0.9300.
On the flip side, the pair is about to test 0.9130. Below, more weakness is seen. The next support level stands at 0.9100 and 0.9065.
More levels
Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
