- USD/CHF got stuck between 0.8180–0,8300 because the buyers do not keep the breakthrough above the resistance.
- RSI remains bear; The break below 0.8200 may reveal on May 7 low and YTD at 0.8034.
- Bulls must recover 0.8250 to test 0.8300 and challenge the 50-day SMA challenge to 0.8376.
USD/CHF Trades subdued on Friday after a USA report showed that inflation is approaching 2% of the Federal Reserve (FED). Meanwhile, US President Trump complained about sluggish negotiations between Beijing and Washington, which resisted the markets. He stated, however, that he would talk to the President of China XI Jinping to aid solve the problem. The pair trades flat to 0.8227.
USD/CHF price forecast: technical perspectives
USD/CHF remains biased, but the trend got strict, consolidating in the range of 0.8180-0.8300 in the last eight days. On Thursday, the couple reached a seven -day maximum of 0.8347, but buyers did not maintain a 0.8300 sign, which tightened the decrease in the pair in the direction of the 0.8200 sign.
Momentum, measured by a relative force indicator (RSI), is bears, but buyers with USD/CHF above 0.8200 can open the door to higher prices.
Despite this, the path of the lowest resistance is down. The first support is 0.8200, and then low level 7 0.8184. After further weakening of the next observed support is 0.8034, every year (YTD) low.
And vice versa, if the USD/CHF rallies 0.8250, look for a 0.8300 test. With further strength, another resistance would be a 50-day straight movable (SMA) 0.8376, followed by a 0.84 sign.
USD/CHF price chart – every day
FAQ of the Swiss franc
Frank Swiss (CHF) is the official currency of Switzerland. This is one of the ten most rotating currencies around the world, reaching volumes that significantly exceed the size of the Swiss economy. Its value depends on the broad market mood, the economic health of the country or the actions taken by the Swiss National Bank (SNB). In the years 2011–2015 the Swiss Frank was set at EURO (EUR). PEG was suddenly removed, which caused an escalate in the franc value by over 20%, causing confusion in the markets. Although PEG does not apply, CHF fortunes are usually strongly correlated from the euro due to the high dependence of the Swiss economy from the neighboring euro area.
FRANC (CHF) Swiss is considered to be safe and sound or currency, which investors buy in times of market stress. This is due to the perceived status of Switzerland in the world: a stable economy, a forceful export sector, vast central bank reserves or a long -term political position towards the neutrality of global conflicts make the country’s currency a good choice for investors escaping at risk. Turbulent times will probably strengthen CHF in relation to other currencies that are seen as more risky to invest.
The Swiss National Bank (SNB) meets four times a year – once a quarter, less than other vast central banks – decide about monetary policy. The bank is aimed at an annual inflation rate less than 2%. When the inflation is above the target or it is expected that it will be above the target in the foreseeable future, the bank will try to tame the escalate in prices, raising the policy rate. Higher interest rates are generally positive for the Swiss franc (CHF) because they lead to higher crops, which makes the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken CHF.
The release of macroeconomic data in Switzerland is the key to assessing the state of the economy and can affect the valuation of the Swiss Francang (CHF). The Swiss economy is essentially stable, but any sudden change in economic growth, inflation, current account or central bank foreign reserves can potentially cause CHF movements. Basically high economic growth, low unemployment and high trust are good for CHF. And vice versa, if economic data indicate a weakening rush, CHF probably absorbs.
As a petite and open economy, Switzerland is strongly dependent on the health of neighboring euro -zone economies. The wider European Union is the main economic partner of Switzerland and a key political ally, so the stability of macroeconomic and monetary policy in the euro area is necessary for Switzerland, and therefore for Swiss franc (CHF). With such a relationship, some models suggest that the correlation between the fate of the euro (EUR) and CHF is over 90%or is close to the ideal.
