USDCHF Remains as Risk of Declines

Key Highlights

  • US Dollar struggled during the past couple of sessions against currencies such as the Euro and the Swiss Franc.
  • USDCHF is trading lower with support at 0.9300, which if breached might ignite more losses.
  • US Services Purchasing Managers Index (PMI) released by Markit Economics posted a decline from the last reading of 56.4 to 56.2 in May 2015.

US Services PMI

Earlier during the NY session, the US Services Purchasing Managers Index (PMI), pointing business conditions in the services sector was released by Markit Economics. The forecast was lined up for an increase from the last reading of 56.4 to 56.5 in May 2015. However, the outcome was a bit on the lower side, as US Services Purchasing Managers Index registered a decline to 56.2.

US Services PMI

The report stated that Business activity continued to improve across the U.S. service sector in May. However, the latest report suggests that there is a slight loss of momentum since the previous month. On the other end, the incoming new work and service providers were on the better side, and added to their payroll numbers at a robust pace. There was one negative to note, as the Markit Flash U.S. Composite PMI Output Index declined to 56.1 in May, lower compared with 57.0 in April.

Commenting on the report, the chief economist at Markit, Chris Williamson, stated that “The US economy looks to have grown at a healthy pace in May, providing further evidence that the rate of expansion has picked up from the weak start to the year”.

USDCHF – Technical Analysis

The US Dollar after trading as low as 0.9300 against the Swiss Franc managed to pop higher. However, it found resistance around an important bearish trend line on the hourly chart of USDCHF. One key thing to note is that the same trend line is coinciding with the 100 hourly simple moving average. Overall, there is a major hurdle forming around 0.9380-0.9400. An initial resistance is around the 50% Fib retracement level of the last drop from 0.9422 high to 0.9308 low.


On the downside, the last low of 0.9308 might act as a support to USDCHF. A break below the same might call for a move towards 0.9280 where buyers might appear.

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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