USD/CHF Weak Near 0.8000, Vulnerable to More Losses.
USD/CHF remains weak near monthly lows, vulnerable under 0.8000.
FUNDAMENTAL OVERVIEW:
The USD/CHF pair fluctuated between modest gains and minor losses during Monday’s Asian session, trading around 0.7975, nearly unchanged for the day. Spot prices remain close to the lowest level since July 28, suggesting vulnerability to further declines.
The US Dollar (USD) has attracted some buying early in the week, partially recovering losses from Friday’s weaker-than-expected Nonfarm Payrolls (NFP) report. A broadly positive risk sentiment has also weighed on the safe-haven Swiss Franc (CHF), providing some support for the USD/CHF pair.
Upside momentum for the USD, however, remains limited amid rising bets for more aggressive Federal Reserve (Fed) policy easing. Markets are pricing in the possibility of a jumbo September rate cut and up to three cuts by year-end, capping any meaningful USD appreciation and restraining the USD/CHF pair.
From a technical perspective, Friday’s close below the 0.8000 psychological level—the first since July 25—suggests that the path of least resistance remains to the downside. Any attempted recovery may act as a selling opportunity and could fizzle without fresh US economic catalysts.
Market attention now turns to this week’s US inflation releases—the Producer Price Index (PPI) on Wednesday and the Consumer Price Index (CPI) on Thursday. These key readings are expected to guide the next directional move for the Greenback and provide significant impetus to USD/CHF toward the latter part of the week.
USD/CHF TECHNICAL ANALYSIS CHART:
Technical Overview:
USD/CHF is trading within a down channel.
USD/CHF is moving below all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Neutral Zone, while the Stochastic oscillator suggests a Negative trend.
Immediate Resistance level: 0.7999
Immediate support level: 0.7942
HOW TO TRADE USD/CHF
On the higher time frame, USD/CHF initially found support after a sustained decline, triggering a reversal and a brief upside move. The pair gained strength and broke a key resistance level, but upside momentum quickly faded, pushing prices lower again. Currently, USD/CHF has broken a critical support and is trading below it. Following this downward momentum, a short-term pullback is expected. If the pair faces rejection near the upside, the decline may resume, extending further downside potential.
