USD/CHF Remains At Risk Of More Downsides

Key Highlights

  • The US Dollar recently failed to break the key 1.0000 resistance against the Swiss Franc.
  • A crucial resistance is formed near 0.9990 on the 4-hours chart of USD/CHF.
  • The US ISM Non-Manufacturing Index declined from 59.7 to 56.1 in March 2019.
  • The US Initial Jobless Claims for the week ending March 30, 2019 could rise from 211K to 216K.

USDCHF Technical Analysis

After trading as low as 0.9896, the US Dollar recovered above 0.9950 against the Swiss Franc. However, the USD/CHF pair failed to break the key 1.0000 resistance and recently declined.

USDCHF Technical Analysis US Dollar Swiss Franc

Looking at the 4-hours chart, the pair started a decent recovery from the 0.9896 low and climbed above the 0.9950 and 0.9975 resistance levels. There was even a break above the 50% Fib retracement level of the last decline from the 1.0052 high to 0.9896 low.

However, the pair faced a strong resistance near 1.0000 and the 100 simple moving average (4-hours, red). The pair declined recently below 0.9975 and it seems like there is a crucial resistance formed near 0.9990 and a bearish trend line on the same chart.

A break above 0.9990 and follow through above 1.0000 might start a solid upward move. On the downside, there is a decent support formed near 0.9940. If there is a break below the 0.9940 support, the pair is likely to revisit the 0.9900 support area.

Fundamentally, the US ISM Non-Manufacturing Index for March 2019 was released by the Institute for Supply Management (ISM). The market was looking for a minor decline from the last reading of 59.7 to 58.0.

The actual result was lower than the forecast, as the US ISM Non-Manufacturing Index declined from 59.7 to 56.1, but the overall economy grew for the 119th consecutive month.

The report added:

The New Orders Index registered 57.4 percent, an increase of 1.9 percentage points from the February reading of 55.5 percent. The Production Index registered 55.8 percent, a 1-percentage point increase compared to the February reading of 54.8 percent.

Overall, the US dollar might continue to struggle in the short term and a break above 1.0000 is needed for USD/CHF to continue higher.

Economic Releases to Watch Today

  • US Initial Jobless Claims – Forecast 216K, versus 211K previous.
  • Canada’s Ivey PMI March 2019 – Forecast 51.1, versus 50.6 previous.


Aayush Jindal

Aayush is a Senior Forex, Cryptocurrencies and Financial Market Strategist with a background in IT and financial markets. He specialises in market strategies and technical analysis, and has spent over a decade as a financial markets contributor and observer. He possesses strong technical analytical skills and is well known for his entertaining and informative analysis of the currency, commodities, Bitcoin and Ethereum markets.

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