USD/CHF sellers approach 0.9225 support with eyes on US PMIs
|- USD/CHF takes offers to reverse previous day’s bounce off 8.5-month low.
- Markets stabilize after global central banks portrayed a volatile day, allowing sellers to sneak in.
- Failure to cross support-turned-resistance directs bears towards three-week-old trend line support.
- Preliminary PMIs for December, risk catalysts will be important for fresh impulse.
USD/CHF stays pressured around the intraday low near 0.9270 as it reverses the previous day’s rebound from a multi-day bottom during Friday’s sluggish Asian session.
The Swiss Franc (CHF) pair’s previous recovery could be linked to the market’s rush for the US Dollar in search for safety as major central banks, including the Swiss National Bank (SNB), announced rate hikes. Not only that, the policymakers’ readiness to keep the rate higher for longer also favored the US Dollar’s safe-haven demand.
Additionally, US President Joe Biden’s crackdown on Chinese IT companies added strength to the risk-off mood and propelled the USD/CHF prices.
That said, a lack of major data/events during the early Asian session joins the market’s consolidation after a big day to resume the USD/CHF pair’s downside. Additionally, the favoring the pair sellers is the technical pattern that could term Thursday’s recovery as a corrective bounce which could not clear important resistance.
Moving on, the first readings of December month activity numbers will be important for the USD/CHF pair traders for clear directions.
Technical analysis
A clear downside break of the monthly support line, followed by failure to cross the same during a corrective bounce, keeps the USD/CHF bears hopeful amid steady RSI (14) conditions.
That said, a downward-sloping support line from November 24, close to 0.9225, could restrict the short-term downside of the Swiss Franc (CHF) pair. Following that, a late March low near 0.9195 will be in focus.
Alternatively, recovery moves need to cross the support-turned-resistance, around 0.9300 by the press time, to retake control. Even so, the 50-SMA and the 100-SMA can challenge the buyers around 0.9345 and 0.9390 in that order.
USD/CHF: Four-hour chart
Trend: Limited downside expected
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 assets. 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 Open Markets 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. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.