USDCHF Technical Analysis

US

• The Fed left interest rates unchanged as
  expected with basically no change to the statement.
• Fed Chair Powell stressed
  once again that they are proceeding carefully as the full effects of policy
  tightening have yet to be felt.
• The recent US Core PCE came
  in line with expectations.
• The labour market is
  starting to show some weakness as Continuing Claims are now
  rising at a fast pace and the NFP data
  last Friday missed across the board.
• The US Consumer
  Confidence fell for the third consecutive month
  although the data beat expectations.
• The US ISM
  Manufacturing PMI last week missed expectations by a big
  margin, followed later on Friday with a disappointing ISM Services PMI,
  although the index remained in expansion.
• The market doesn’t expect the Fed to hike anymore.

Switzerland

• The SNB kept interest rates steady at 1.75% vs. 2.00% expected as the
  central bank sees the significant tightening in recent quarters countering the
  remaining inflationary pressures.
• The Switzerland CPI ticked higher recently but the
  inflation rate is comfortably in the SNB’s 0-2% target band for both the
  headline and core measures.
• The Unemployment Rate matched the
  previous reading hovering at cycle lows.
• The Manufacturing PMI missed expectations and fell
  further into contraction, while the Services PMI remain in expansion.
• The market doesn’t expect the SNB to
  hike anymore.

USDCHF Technical Analysis –
Daily Timeframe

On the daily chart, we can see that the USDCHF pair
retested the broken trendline around
the 0.91 handle where we had also the 61.8% Fibonacci retracement level
for confluence. The
sellers stepped in to position for a drop into the 0.88 handle and increased
the bearish bets as the US labour market data disappointed.

USDCHF Technical Analysis –
4-hour Timeframe

On the 4-hour chart, we can see that the price is
now testing a strong resistance zone
around the 0.90 handle where we can find the confluence with the downward
trendline, the red 21 moving average and the
50% Fibonacci retracement level.

This is where the sellers are likely to step in
again with a defined risk above the trendline and target the 0.88 handle. The
buyers, on the other hand, will want to see the price breaking higher to
invalidate the bearish setup and position for a rally back into the 0.91
handle.

USDCHF Technical Analysis –
1-hour Timeframe

On the 1-hour chart, we can see more
closely the bearish setup with the price action now confined between the 0.9020
resistance and the 0.8990 support. More conservative sellers may want to wait
for the price to break below the support to increase the bearish bets into the
0.88 handle.

Upcoming Events

This week is pretty empty on the data front with just
the US Jobless Claims tomorrow and the University of Michigan Consumer
Sentiment on Friday being the only notable events. The market is likely to
focus on the US Jobless Claims given the recent weakness in the labour market
data.

Source: https://www.forexlive.com/technical-analysis/usdchf-technical-analysis-20231108/