- USD/CHF extends its weekly gains and erases last week’s losses, rising 1%.
- USD/CHF is heading higher and could test the 20-day EMA; otherwise losses will extend towards 0.9400.
The USD/CHF rises for the second day in a row, widening the gap between the 200 day EMA and the exchange rate, courtesy of broad US dollar strength, underpinned by high US Treasury yields, in the mid of the American session. At the time of writing, USD/CHF is trading at 0.9501, up 0.55%.
USD/CHF Price Analysis: Technical Outlook
USD/CHF is about to test the upper trend line of a descending channel. It is worth noting that although a successive series of lower highs and lower lows confirms that the pair is in a downtrend, the failure of the sellers to capture the 200 day EMA at 0.9431 exposed the pair to buying pressure. Therefore, USD/CHF rose from multi-month lows below 0.9400 towards current price levels.
If the USD/CHF buyers want to regain control, they need to break above the upper trend line of the channel, which also intersects the 20-day EMA at 0.9549. Once broken through, this would pave the way towards the 100 day EMA at 0.9631, followed by the 50 day EMA at 0.9651.
On the other hand, if the currency falls and closes below 0.9500, this could pave the way for further losses. Therefore, the first support for the USD/CHF would be the 16th Aug low at 0.8445, followed by the 200-day EMA at 0.9431 and the yearly low at 0.9370.
Technical levels
Source: Fx Street
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