Current trend

During the Asian session, the USD/CHF pair is showing flat dynamics, holding close to 0.8480 and preparing to end the week with a slight increase supported by US macroeconomic statistics.

Thus, the revised estimate for the Q2 gross domestic product (GDP) increased by 3.0% YoY compared to the forecasts of 2.8%, creating a certain reserve for the US Fed in gradual monetary policy easing, the launch of which is expected as early as September. Thus, strong data contributed to a decrease in the likelihood of an interest rate adjustment by –50 basis points but everything may change. Meanwhile, initial jobless claims for the week ending August 23 fell from 233.0K to 231.0K, below market expectations of 232.0K, while continuing claims rose from 1.855M to 1.868M, while analysts expected 1.87M. On Friday, investors are awaiting the publication of the personal consumption expenditure price index, one of the key indicators for the regulator in assessing the average inflation dynamics, which can significantly affect the September decision on monetary policy. Forecasts suggest a slight increase in the core indicator in July from 2.6% to 2.7% and the broader one from 2.5% to 2.6%.

Traders will pay attention to the leading indicators index from the Swiss Economic Institute (KOF), which may decrease from 101.0 points to 100.6 points. Swiss National Bank Governor, Thomas Jordan, due to step down at the end of September, highlighted the challenges facing the country’s industry due to the recent franc strengthening and poor demand in the EU, especially Germany. The official also reiterated his commitment to maintaining price stability and inflation in the range of 0.0–2.0%, which he called the most important prerequisite for economic recovery. He reiterated that interest rates remain the regulator’s main instrument for achieving this, although currency interventions are possible if necessary. Markets currently price the probability of a 25 basis point easing at the next meeting on September 26 at 70.0%, and a more aggressive 50 basis point change at 30.0%.

Support and resistance

On the daily chart, Bollinger bands are steadily declining. The price range is practically unchanged, remaining quite spacious for the current level of market activity. The MACD indicator is reversing upwards, forming a new buy signal (the histogram is above the signal line). Stochastic is growing in the middle of the working area.

Resistance levels: 0.8500, 0.8559, 0.8600, 0.8630.

Support levels: 0.8450, 0.8400, 0.8365, 0.8331.

Trading tips

Long positions may be opened after a breakout of 0.8500, with the target at 0.8600. Stop loss – 0.8450. Implementation period: 2–3 days.

Short positions may be opened after a rebound from 0.8500 and a breakdown of 0.8450, with the target at 0.8365. Stop loss – 0.8500.