USD/CHF Price Analysis: Bears Point to Pre-Fed Correction

  • USD/CHF bears are on the lookout for resistance.
  • All eyes on key US events and market structure.

USD/CHF is up around 0.7% and has rallied from a low of 0.9015 to a high of 0.9109 so far. The key event will be the Federal Reserve and according to the CME FedWatch tool, money markets are leaning towards a pause from the Fed when it announces its rate decision on Wednesday.

Meanwhile, the technical outlook is clouded by a breakout of the key structure to the downside followed by a strong move to the upside:

daily chart

USD/CHF broke below the uptrend line from early June. The pair broke out of a key structural point on Thursday but has since rallied back to the origin of the move.

4 hour chart

Although the bulls could continue to advance, we are in resistance. A correction towards former resistance could be in the offing ahead of key events this week, including Tuesday’s US Consumer Price Index.

A negative outcome from these events could lead to a break below 0.9000 with a target of 0.8950.

Source: Fx Street

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