- USD/CHF is struggling to extend the upside above 0.9280, upside seems favored amid the upbeat market mood.
- The US Dollar Index (DXY) has shifted its auction above 102.50 as Fed might not pause its policy tightening spell.
- A pullback move to near 10-period EMA will present a bargain buy for the market participants.
The USD/CHF pair is facing fragile barricades after a perpendicular rally to near 0.9280 in the early Asian session. The Swiss franc asset is expected to display a volatility contraction before resuming its upside journey as the US Dollar seeks more strength for further upside.
S&P500 settled Friday with significant losses as the stronger-than-projected United States Nonfarm Payrolls (NFP) report faded expectations of a pause in the policy tightening spell by the Federal Reserve (Fed). The US Dollar Index (DXY) has shifted its auction above 102.50 and is expected to continue its upside momentum ahead.
USD/CHF has sensed long liquidation after a vertical rally to near the horizontal resistance placed from January 24 high around 0.9280. The Swiss franc asset needs more strength for printing more gains. Therefore, the major might demonstrate some volatility contraction before resuming its upside journey.
The Relative Strength Index (RSI) (14) is oscillating in a bullish range of 60.00-80.00, showing no signs of divergence but an overbought situation cannot be ruled out.
A minor pullback move to near the 10-period Exponential Moving Average (EMA) at 0.9233 will trigger a bargain buy opportunity, which will drive the asset towards January 31 high at 0.9288. A break above the latter will expose the asset to January 12 high around 0.9360.
On the flip side, a breakdown of Wednesday’s low at 0.9059 will drag the major toward 4 August 2021 low at 0.9018. A slippage below the latter will drag the asset further toward 10 May 2021 low at 0.8986.
USD/CHF hourly chart
-638112357044516997.png)
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD treads water just above 1.0400 post-US data
Another sign of the good health of the US economy came in response to firm flash US Manufacturing and Services PMIs, which in turn reinforced further the already strong performance of the US Dollar, relegating EUR/USD to the 1.0400 neighbourhood on Friday.
GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
Rising tensions between Russia and Ukraine caused renewed unease in the markets this week. Putin signed an amendment to Russian nuclear doctrine, which allows Russia to use nuclear weapons for retaliating against strikes carried out with conventional weapons.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.