USD/CHF testing the upper band of the daily channel

The USD/CHF has been confined in a narrow 30-pip channel on Monday and is now making an attempt to break above this channel. At the moment the pair is at 0.9985, where it closed the previous week.

The upsurge seen in the US Dollar Index in the past couple of hours seems to be the source of this recent rise in the USD/CHF. At the moment, DXY is at 100.20, recording a %0.05 daily increase. The positive mood surrounding the major US equity indices and Chicago Fed President Charles Evans' comments have provided extra legs for the USD.

In an interview with Fox Business, Charles Evans suggested that the inflation could start rising amid fiscal policy and added that if the economy "really" picks up, four rate hikes could be possible.

Following a meeting of G-20 finance minister and central bankers, President Thomas Jordan of SNB reiterated his view on the CHF by saying that they suffer from an overvalued franc and must try to contain this overvaluation.

Technical outlook

To the upside, resistances are aligned at 1.000 (psychological level), 1.0060 (20-DMA) and 1.0090 (100-DMA). Below the daily low at 0.9960, 200-DMA at 0.9940 is forming a tough dynamic support. In case this support is violated, 0.9860 (Jan. 1 low) could be the next target.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.