Fed Chairman Jerome Powell recently signaled that the Federal Reserve isn’t rushing to reduce interest rates. Now, we’re eyeing whether this stance could help USD/CHF climb past a critical resistance level. Let’s dive into what the daily chart reveals about this currency pair’s potential movement.
In a recent announcement, Powell emphasized that the Federal Reserve is holding off on rate cuts until there’s significant slowing in the labor market or inflation drops considerably. Meanwhile, the Swiss franc, like other European currencies, is facing challenges. This comes as traders brace themselves for possible global tariff tensions, diminishing the franc’s safe-haven appeal amid a robust dollar and soaring gold prices.
Fundamentals often drive market trends and volatility, so if you haven’t brushed up on the economic outlooks for both the U.S. dollar and the Swiss franc, now’s the time to review the economic calendar and keep up with the latest financial news.
Since September, USD/CHF has been trending upwards, picking up momentum recently and heading towards the .9200 psychological level. Interestingly, this level is close to the R1 (.9218) Pivot Point line and marks a resistance area that has held since March 2023—the same month Taylor Swift kicked off her Eras tour, coincidences aside.
With USD/CHF roughly 70 pips shy of .9200, traders still have some time to strategize for a potential resistance test. Look for bearish candlestick patterns forming around this level, which could indicate selling pressure pushing USD/CHF down toward the .9000 support zone.
Conversely, if USD/CHF breaches .9200 or stays above R1 or R2 Pivot Points, it may embolden dollar bulls to aim for higher targets such as .9400 or .9800.
As always, consider other significant market catalysts that might sway sentiment and remember to employ sensible position sizing when entering trades to manage risk effectively.
