USD/CHF outlook: Swiss Franc falls after SNB's surprise 0.50% rate cut

USD/CHF

USDCHF rose to two-week high on 0.8% jump on Thursday morning, after the Swiss National Bank surprised by 50 basis points rate cut (0.50% from 1%) against widely expected 25 basis points cut.

This was the fourth policy easing in 2024, following three 0.25% cuts in March, June and September, and the biggest rate reduction in nearly a decade.

The SNB said it will continue to monitor the situation and act accordingly in order to maintain price stability and inflation within the central bank’s0%-2% range (November inflation was 0.7%).

Fresh post-SNB acceleration extended recovery leg from 0.8725 (Dec 6 higher low) into fifth straight day and broke above Fibo 61.8% retracement of 0.8957/0.8725 pullback, also denting the lower platform at 0.8890 zone.

Sustained break above these levels is needed to validate fresh bullish signal and open way for full retracement of 0.8957/0.8725 bear-leg.

Technical studies on daily chart are still mixed as 14-d momentum dips further in the negative territory, conflicting MA’s in bullish configuration and formation of 10/200 DMA golden cross.

Near-term bias is expected to remain with bulls while the price stays above broken Fibo 50% level at 0.8841, reinforced by 20DMA, which reverted to support.

Caution on loss of 200DMA pivot (0.8824) which would signal recovery stall and shift near-term focus to the downside.

Res: 0.8869; 0.8893; 0.8902; 0.8917.
Sup: 0.8841; 0.8824; 0.8814; 0.8780.