Current trend

The USD/CHF pair is developing a technical correction, preparing to test strong psychological support at 0.9000. The American currency is under pressure from reduced investor activity amid the Independence Day celebrations in the United States. In addition, traders continue to analyze Wednesday's macroeconomic statistics. Among other things, they drew attention to the sharp decline in the  US Services PMI from the Institute for Supply Management (ISM) in June from 53.8 points to 48.8 points, with the expected 52.5 points, and the similar indicator from S&P Global adjusted from 55.1 points to 55.4 points, while analysts expected no change. In turn, Factory Orders in May lost 0.5% after increasing by 0.4% in the previous month.

Tomorrow at 14:30 (GMT 2), the June labor market report will be presented, which could significantly influence the US Federal Reserve's decisions on monetary policy. According to forecasts, Nonfarm Payrolls in June will decrease from 272.0 thousand to 190.0 thousand, the Average Hourly Earnings — from 4.1% to 3.9% in annual terms and from 0.4% to 0.3% on a monthly basis, and the Unemployment Rate will remain unchanged at 4.0%. Speaking at the European Central Bank (ECB) forum in Sintra, US Federal Reserve Chairman Jerome Powell confirmed that for now officials are taking a wait-and-see approach to interest rate adjustments, while carefully assessing further risks of the balance between containing inflation and the worsening situation in the labor market. The official forecasts of the American regulator suggest one and a half full reduction in borrowing costs by 25 basis points by the end of the year from the current 5.50% to 5.10%, while analysts expect one or two adjustments before the end of 2024, the first of which may take place already in September.

Today at 8:30 (GMT 2), inflation statistics were published in Switzerland: the Consumer Price Index in monthly terms slowed down from 0.3% to 0.0% with a forecast of 0.1%, and the annual figure dropped to 1.3%, while analysts expected the value to remain at 1.4%.

Support and resistance

Bollinger Bands in D1 chart show weak growth. The price range expands, freeing a path to new local highs for the "bulls". MACD indicator is trying to reverse into the descending plane, keeping the previous buy signal (located above the signal line). Stochastic is showing a more confident decline and is currently leaving the overbought area with a sell signal.

Resistance levels: 0.9037, 0.9071, 0.9100, 0.9130.

Support levels: 0.9000, 0.8964, 0.8935, 0.8900.

Trading tips

Short positions may be opened after a breakdown of 0.9000 with the target at 0.8935. Stop-loss — 0.9037. Implementation time: 1-2 days.

A rebound from 0.9000 as from support followed by a breakout of 0.9037 may become a signal for opening new long positions with the target at 0.9100. Stop-loss — 0.9000.