- USD/CHF bounces off 0.9099 amid risk-off market sentiment.
- The US Dollar Index rises in the day, despite falling US T-bond yields.
- The USD/CHF 4-hour chart shows the pair is within a bullish flag, but a break below 0.9100 could invalidate the chart pattern.
The USD/CHF trims some weekly losses, advances sharply during the New York session, up 0.61%, trading at 0.9171 at the time of writing. Comments of some US CEOs about supply shortages, and higher costs amid companies missing earnings expectations, dampened the market sentiment. Additionally, inflationary pressures and central bank tightening monetary conditions kept investors at bay
Earlier in the day, the USD/CHF printed a weekly low of around 0.9099. But once American traders got to their desks, the pair jumped almost 70 pips, due in part to month-end flows and US dollar demand.
In the meantime, the US Dollar Index is rising almost 1%, sitting at 94.28 amid falling US T-bond yields. The US 10-year Treasury yield is flat, currently at 1.568%.
On the macroeconomic front, the US Personal Consumption expenditures, the Fed’s preferred inflation gauge, surged 3.6% year-on-year in September, a tad lower than expectations but in line with the August figure, signaling that inflation is stabilizing after a sudden jump to 6.1%.
USD/CHF Price Forecast: Technical outlook
The USD/CHF pair is in a downtrend, shown by the simple moving averages (SMA’s) located above the spot price. Furthermore, a descending channel that seems to be a bullish flag capped the last downward move, bouncing off the bottom of the channel, towards the 50-simple moving average at 0.9181.
Nevertheless, the Relative Strength Index (RSI) at 48 is seesawing up and down, showing no clear confirmation of the actual trend.
If USD/CHF buyers fail to gain traction above 0.9200, investors could expect a renewed re-test of the daily lows around 0.9099.