Fundamental
Overview
The bullish momentum in the
US Dollar seems to be waning despite the recent higher-than-expected US CPI and PPI reports. One caveat is that the market has now
priced out the aggressive rate cuts expectations and it’s almost perfectly in
line with the Fed’s projections.
Therefore, we will likely
need more strong US data to see the market pricing in an earlier pause in the
Fed’s easing cycle and give the US Dollar a further boost.
In the bigger picture, it
looks like the US long term yields are bound to rise further, which should keep
the recent uptrend in the USD intact, but more bullish catalysts for the
greenback would give more conviction for the buyers.
The next big risk events will
be in November when we get the October data and the US election.
USDCHF
Technical Analysis – Daily Timeframe
USDCHF Daily
On the daily chart, we can
see that USDCHF reached a new high yesterday as the USD got bid across the
board although without a catalyst. The resistance
around the 0.8730 level remains the main target for the buyers. The sellers
will want to see the price falling back below the 0.8550 level to pile in for a
drop into the 0.8333 level next.
USDCHF Technical
Analysis – 4 hour Timeframe
USDCHF 4 hour
On the 4 hour chart, we can
see that we have an upward trendline defining the current bullish
momentum. The buyers will likely keep on leaning on it to position for further
upside. The sellers, on the other hand, will want to see the price breaking
lower to pile in for a drop into the 0.8333 level.
USDCHF Technical
Analysis – 1 hour Timeframe
USDCHF 1 hour
On the 1 hour chart, we can
that the price is consolidating just above recent resistance
turned support around the 0.86 handle. The buyers will likely step in here
with a defined risk below the support to position for a rally into new highs,
while the sellers will look for a downside break to position for a drop into
the trendline. The red lines define the average daily range for today.
Upcoming
Catalysts
This week is pretty empty on the data front with just a couple of key economic
releases. On Thursday, we get the US Retail Sales and US Jobless Claims data.