Fundamental Overview
The USD got a boost yesterday from strong US Consumer Confidence data which triggered an aggressive rise in Treasury yields. The report however just showed that the labour market remains resilient which is good news for growth and not necessarily bad news for inflation.
The CHF, on the other hand, remains under pressure from the positive risk sentiment in the markets and the rate cuts expectations from the SNB. There’s no real strong reason for the Swiss Franc to rally at the moment, so the gains might come from a weak USD.
USDCHF Technical Analysis – Daily Timeframe
On the daily chart, we can see that USDCHF bounced on the key 0.90 handle and extended the rally into the 0.9150 region as the US PMIs kept the greenback stronger against the Swiss Franc. The sellers will need to see the price falling below the 0.90 handle to technically reverse the bullish trend.
USDCHF Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price yesterday bounced on the support zone around the 0.91 handle where we had also the 38.2% Fibonacci retracement level for confluence. The buyers piled in there supported by the strong US data.
A break above the 0.9157 level should see the buyers increasing the bullish bets into the 0.9250 level. The sellers, on the other hand, will want to see the price falling below the support to position for a drop into the 0.90 handle.
USDCHF Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we have a resistance around the 0.9130 level where we can also find the 61.8% Fibonacci retracement level for confluence. This is where the sellers are leaning with a defined risk above the level to position for a break below the 0.91 support with a better risk to reward setup. The buyers, on the other hand, will want to see the price breaking higher to increase the bullish bets into new highs.
Upcoming Catalysts
Tomorrow we will see the Switzerland GDP and the latest US Jobless Claims figures. On Friday, we have the Switzerland Retail Sales and Manufacturing PMI, while later in the day we conclude with the US PCE report.
