USD/CHF Nosedives, Dollar Faces Increase In Selling Pressure
- USD/CHF declined sharply below 0.9120 and 0.9100.
- EUR/USD extended its rise above the 1.1850 resistance level.
- GBP/USD rallied and broke the 1.3100 resistance zone.
- The US Initial Jobless Claims could decline from 898K to 860K in the week ending Oct 17, 2020.
USD/CHF Technical Analysis
The US Dollar started a sharp decline from 0.9165 against the Swiss Franc. USD/CHF broke many important supports near 0.9120 and 0.9000 to move into a bearish zone.
Looking at the 4-hours chart, the pair gained bearish momentum below the 0.9100 support, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
The recent decline was triggered after there was a break below a contracting triangle with support at 0.9135. Finally, there was a clear break below the 0.9065 support level and the pair traded close to 0.9030.
If there is an upside correction, the 0.9165 level might act as a hurdle. The main resistance is now forming near the 0.9100 level (the recent breakdown zone).
On the downside, an initial support is near the 0.9020 level. The key support is near the 0.9000 level, below which there is a risk of a larger decline. In the stated case, the bears might aim a test of the 0.8940 support level.
Looking at EUR/USD and GBP/USD, it seems like the US dollar faced an increase in selling pressure across the board. EUR/USD extended its rise above the 1.1850 resistance, and GBP/USD rallied above 1.3000 and 1.3100.
Upcoming Economic Releases
- US Existing Home Sales Sep 2020 (MoM) - Forecast +5.0%, versus +2.4% previous.
- US Initial Jobless Claims - Forecast 860K, versus 898K previous.