On the daily USDCHF chart below, we can see that the Swiss Franc is comfortably in charge as the pair keeps drifting lower on expectations that the Fed may be near the end of its tightening cycle and will cut rates soon after. We saw a bit of a pullback last week as the US PMIs surprised to the upside and gave the dollar a boost, but this week the data was against the greenback.

The US ISM Manufacturing PMI missed expectations and the sub-indexes like employment, prices paid and new orders all contracted by a notable margin. Yesterday, the US Job Openings missed expectations and added to the expectations that the recession is near and we will get rate cuts earlier than expected.

USDCHF Technical Analysis

On the 4 hour chart below, we can see that the price is currently breaking below the 2023 low set in February and it’s now looking for a new lower low. The sellers have been clearly in control and now will look at today’s US ISM Services PMI report to see whether they can add more to the selling momentum or wait a bit. If we get a beat, it’s more likely that we will see a pullback, while a miss should increase the selling pressure.

On the 1 hour chart below, we can see that in case the price pulls back, a good spot to lean on for the sellers should be the trendline and the 38.2% Fibonacci retracement level. It looks unlikely that we’ll get there though unless the data beats expectations. The buyers will need a break above the trendline and better yet above the 0.9118 resistance to gain the conviction and target the 0.92 handle. The sellers, on the other hand, are likely to step in both at the trendline and the 0.9118 resistance.