- USD/CHF is focused on reclaiming the crucial resistance of 0.8900 amid risk-off sentiment.
- Fed Chair Jerome Powell will offer new guidance on the outlook for interest rates.
- The term of Thomas Jordan, governor of the SNB, will end in the second half of this year.
The pair USD/CHF rises slightly above 0.8850 during the European session on Tuesday, as investors turn cautious ahead of Federal Reserve (Fed) Chairman Jerome Powell's testimony before Congress on Wednesday and non-farm payrolls (NFP) data ) from the United States later this week.
The pair extends its uptrend as the DXY Dollar Index rebounds from the two-day low around 103.70. Comments from Fed Chair Jerome Powell and February labor market data will provide new clues about when the Fed will begin cutting interest rates..
The Swiss Franc does not find buying interest despite the fact that the annual Consumer Price Index (CPI) remained above expectations in February. The monthly CPI registered a sharp rise of 0.6%, compared to 0.2% in January. The monthly pace was significantly higher than necessary to keep inflation below 2%. The annual CPI stood at 1.2%, above expectations of 1.1%, but below the previous reading of 1.3%.
Meanwhile, it is announced that the SNB is searching for President Thomas J. Jordan's successor. The new president of the SNB will be announced in the second half of this year.
He USD/CHF seems to turn lower as it tries to break out of the consolidation formed in the range of 0.8744-0.8898 on the 4-hour chart. A slight selling near the top end of the consolidation does not indicate a reversal, but indicates that the Dollar bulls need more strength for a decisive breakout. The consolidation pattern indicates a sharp contraction in volatility. A breakout of the consolidation zone will lead to an expansion in volatility, leading to broader moves and high volume.
The 50-period exponential moving average (EMA) near 0.8822 continues to support the US Dollar bulls.
The 14-period Relative Strength Index (RSI) exceeds 60 points. If the RSI (14) were to remain above, bullish momentum would occur.
Further rises would occur if the pair breaks above the three-month high around 0.8900which would unlock increases towards the September 20 low in 0.8932 and the minimum of November 8 in 0.8976.
Conversely, a break below the February 13 low in 0.8746 would expose the pair to the support of the round level of 0.8700followed by the February 1 high around 0.8650.
USD/CHF 4-hour chart
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.
