USD
- The Fed left interest rates unchanged as expected at the last meeting and dropped the tightening bias in the statement.
- The US PCE came in line with expectations.
- The US Jobless Claims missed expectations although the data is still in the recent ranges.
- The latest US ISM Manufacturing PMI missed expectations by a big margin remaining in contraction with the US ISM Services PMI following suit but holding on in expansion.
- The US Consumer Confidence missed expectations across the board.
- The market expects the first rate cut in June.
CHF
- The SNB kept interest rates unchanged at 1.75% at the last meeting stating that they will adjust policy if necessary to ensure that inflation remains in the target range.
- The latest Switzerland CPI beat expectations slightly although the Core measure eased further more.
- The Unemployment Rate remains steady at cycle lows.
- The Manufacturing PMI rose slightly although it remains in contraction, while the Services PMI hold on in expansion.
- The market expects the SNB to cut rates in March.
USDCHF Technical Analysis – Daily Timeframe
On the daily chart, we can see that USDCHF has been consolidating below the 0.8886 high lately maintaining a bullish tilt. Last Friday, the price got rejected from the high following a weaker than expected US ISM Manufacturing PMI, but the buyers rushed to buy the dip around the red 21 moving average to position for a breakout to the upside. In case this consolidation goes on, we can expect the buyers to step in more aggressively around the major upward trendline.
USDCHF Technical Analysis – 4-hour Timeframe
On the 4-hour chart, we can see that the price recently bounced around the previous resistance turned support at 0.8820. This is where we can expect the buyers to step in if the price falls back again into it with a defined risk below the level to target a break above the high. The sellers, on the other hand, will want to see the price breaking lower to target a drop into the major trendline.
USDCHF Technical Analysis – 1-hour Timeframe
On the 1-hour chart, we can see more closely the recent rangebound price action. We can see that the price yesterday bounced near the support and made a new higher high on this timeframe. Aggressive buyers might want to step in at the 0.8841 swing level with a defined risk below it to position for a break above the high with a great risk to reward setup. The sellers, on the other hand, will want to see the price breaking lower to invalidate the setup and position for a break below the 0.8820 support.
Upcoming Events
Today we have the US ADP, the US Job Openings and the Fed Chair Powell speaking. Tomorrow, we will see the Switzerland Unemployment Rate and later in the day, the US Jobless Claims figures. Finally, on Friday, we conclude the week with the US NFP report.
