- USD/CHF bounces from 0.8900, supported by US Dollar resistance.
- Fed policymakers showed no interest in raising interest rates in September.
- USD/CHF recovery stops after approaching the previous resistance zone located in the range of 0.8900-0.9020.
The USD/CHF pair rebounds after correcting near the crucial support of 0.8900, supported by the resistance of the US Dollar amid the risk-off state of the markets. The Swiss Franc remains strong overall as the US Dollar’s appeal is firm due to deepening global uncertainties.
S&P 500 futures generated decent gains in the European session due to the risk aversion theme. US stocks also faced selling pressure on Thursday, as strength in the US economy could allow the Federal Reserve (Fed) to actively discuss further policy tightening.
Regarding monetary policy in September, Fed officials, Dallas Fed President Lorie Logan and New York Fed President John Williams, showed no interest in continuing to raise interest rates.
The Swiss franc remained in action as the Swiss economy remained stagnant in the April-June quarter, while investors anticipated a 0.1% growth rate. In the January-March quarter, the Swiss economy grew by 0.3%.
USD/CHF recovery stops after reaching near the previous resistance zone located in a range of 0.8900-0.9020 on a four-hour scale. The asset is operating in a rising channel chart pattern in which each corrective movement is considered a buying opportunity by market participants. The 50-period Exponential Moving Average (EMA) around 0.8870 continues to provide support to the US Dollar bulls.
Meanwhile, the Relative Strength Index (RSI) (14) is trading in the bullish range of 60.00-80.00, indicating that the upward momentum is already active.
For fresh bullish momentum, the pair needs to rise above the psychological resistance of 0.9000, which would take USD/CHF towards the June 15 highs of 0.9056, and then to the June 12 highs of 0.9109.
In an alternative scenario, a break below the April 30 low around 0.8750 would expose the asset to the August 10 low at 0.8890 and the July 24 low at 0.8637.
USD/CHF 4-hour chart
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Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
