- The USD/CHF rose to a two-week high around 0.9035 near the 20-day SMA.
- The CHF is one the worst-performing currencies in the session.
- The US Dollar is trading soft after PCE figures from September.
- Hawkish bets on the Fed remain low ahead of next week’s meeting.
At the end of the week, the USD/CHF rose for a fourth consecutive day, near 0.9035, piercing through the 200-day Simple Moving Average (SMA) but then getting rejected by the 20-day average. The pair’s trajectory seems to be the CHF’s weakness, which trades with losses against the USD, EUR,GBP and JPY in Friday’s sessions and was one of the weakest currencies in the session.
On the other hand, the US Dollar is also trading soft after key inflation data reported earlier in the session. The U.S. Bureau of Economic Analysis revealed that the Core Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred gauge of inflation, from September, aligned with the consensus. The figure came in at 3.7% YoY, vs. the consensus of 3.7% and decelerated from its previous figure of 3.8%. In addition, The headline PCE Price Index from September came in at 3.4% YoY, vs the expected 3.4% and remained steady regarding its previous figure of 3.4%.
Other data reported strong Consumer Sentiment figures released by the University of Michigan (UoM), which came in at 68.3 vs 68. The 5-year inflation expectations from the same university figures didn’t reveal any surprise and stood at 3%.
Elsewhere, the US government bond yields are seen neutral, with some rates rising and others declining. The 2-year rate stands at 5.03%, while the 5 and 10-year yields are at 4.79% and 4.87%, respectively. In addition, dovish bets on the Federal Reserve (Fed) are still high, and the CME Fed Watch tool indicates that a pause in the next week’s meeting is practically priced in while the odds of a hike in December retreated to 20%. In that sense, the combination of lower US yields and dovish bets on the Fed may limit the upward trajectory of the pair.
USD/CHF Levels to watch
Based on the daily chart, the technical outlook for USD/CHF remains neutral to bullish as the bulls recovered a significant amount of ground during the week. The Relative Strength Index (RSI) jumped above the 50 middle point, while the Moving Average Convergence (MACD) exhibited decreasing red bars.
On the other hand, the pair is below the 20-day Simple Moving Average (SMA), but above the 100 and 200-day SMAs, highlighting the continued dominance of bulls in the broader outlook. However, if the bulls want to continue climbing higher, the 20-day average must be conquered.
Support levels: 0.9000 (200-day SMA), 0.8990, 0.8950.
Resistance levels: 0.9035 (20-day SMA), 0.9050, 0.9070.
USD/CHF Daily Chart
-638340238735586205.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 stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.