USD/CHF Price Forecast: A Selloff or a Further Consolidation?
USD/CHF Technical Outlook
USD/CHF Price – Bears Ease Up
On June 23, USD/CHF rebounded from a near two-week low at 0.9420 and rallied. Nonetheless, the weekly candlestick closed in the red with a 0.4% loss. The Relative Strength Index (RSI) rose from 37 to 44 highlighting a weaker bearish momentum.
The growing coronavirus cases reported recently in some states in the US cast doubt over the reopening of the economy and slowed down the US dollar selloff.
USD/CHF Daily Price Chart ( Sep 20, 2018 – July 2, 2020) Zoomed Out
USD/CHF Daily Price Chart (MAY 25 – July 2, 2020) Zoomed IN
Last week, USD/CHF corrected its downward trend and moved in a sideways move. At the start of this week, the market rebounded around the low end of the current trading zone 0.9438 – 0.9548 reflecting the bear’s hesitation at this point.
A close below the low end of the zone signals that bears could press towards 0.9330 and any further close below that level may encourage them to send USDCHF even lower towards 0.9181.
On the flip side, another close above the low end of the zone could mean more of the same ie, the price could rally towards the high end of the zone and any further close above this level could extend this move towards 0.9640.
USD/CHF Daily Four-Hour Chart (June 7 – July 2, 2020)
Today, USD/CHF has broken below the uptrend move originated from the June 11 at 0.9376 and generated a bearish signal. Additionally, the price rebounded from the aforementioned line indicating that bears were in charge. With that said, any break above the downtrend line originated from the June 8 high at 0.9639 would generate a bullish signal.
Thus, a break below 0.9401 may send USDCHF towards 0.9330. In turn, any break above 0.9553 may trigger a rally towards 0.9629. That said, the weekly support and resistance levels marked on the chart should be kept in focus.
Written By: Mahmoud Alkudsi, Market Analyst
Please feel free to contact me on Twitter: @Malkudsi
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.