USD/CHF Likely To Correct Lower Towards 0.990008 August, 2018 by Aayush Jindal in Market Analysis
- The US Dollar failed to move above the 0.9980 resistance and declined against the Swiss Franc.
- There is a key bearish trend line forming with resistance at 0.9965 on the 4-hours chart of USD/CHF.
- The Swiss Foreign Currency Reserve increased to 750B from 749B in June 2018.
- Spain’s Industrial Output for June 2018 will be released today, which is forecasted to increase 1.0% (YoY).
USDCHF Technical Analysis
The US Dollar traded with bullish moves above the 0.9950 level this past week against the Swiss Franc. However, the USD/CHF pair struggled to clear the 0.9980-0.9985 resistance and later declined.
Looking at the 4-hours chart, the pair traded below the 0.9960 support and the 23.6% Fib retracement level of the last wave from the 0.9867 low to 0.9984 high.
It seems like the pair is struggling to hold gains and it could continue to move down towards the 0.9900 support. An intermediate support is the 50% Fib retracement level of the last wave from the 0.9867 low to 0.9984 high at 0.9925.
On the flip side, if the pair moves higher and breaks the trend line resistance at 0.9965, it may well gain bullish momentum. In this case, the pair could rise towards the 0.9980 and 1.0000 resistance levels.
Overall, the current bias is short-term bearish as long as USD/CHF is below 0.9965 and 0.9980. Looking at the other major pairs, EUR/USD bounced back sharply after trading to a new yearly low below 1.1540.
GBP/USD is holding the 1.2900-20 support zone, but it remains at a risk of more declines in the near term.