Current trend

After the appearance of technical signals about the instrument being oversold, the USD/CHF pair is growing towards the resistance level of 0.8515.

The positive dynamics are supported by US macroeconomic data. The August leading economic indicators index decreased by –0.2% MoM, better than the forecast of –0.3% and the previous value of –0.6%. The September Federal Reserve Bank of Philadelphia manufacturing PMI was 1.7, higher than expectations of –0.8 and –7.0 earlier. The labor market is also offsetting investors’ concerns about the economy. Initial jobless claims for the week amounted to 219.0K, with preliminary estimates of 230.0K. After the decision of the US Fed officials to cut the interest rate by 50 basis points to 5.00%, positive economic data indicate the possibility of further adjustment of the indicator in increments of –25 basis points.

On September 26, market participants are expecting the Swiss National Bank’s (SNB) decision on the interest rate. According to preliminary estimates, the cost of borrowing will decrease by 25 basis points to 1.00%, putting pressure on the franc.

In the long term, the asset is declining: after a significant weakening in May-August, it reached the support level of 0.8405. Also, the relative strength index (RSI (14)) indicated a possible correction by forming a divergence between the price chart and the indicator line. As a result, the quotes moved to growth and reached the resistance level of 0.8515. After a breakout, it may reach the area of ​​0.8635 and 0.8745. If 0.8515 is maintained, the downward trend will continue, with the targets of 0.8405 and 0.8330.

The medium-term trend remains downward: at the end of August, the price overcame the zone of 0.8527–0.8506 and headed towards zone 2 (0.8317–0.8297). At the moment, a correction is developing to the resistance level of 0.8537, after a reversal at which the decline will continue to the area of ​​0.8405. Otherwise, the trend border of 0.8608–0.8587 may be reached, where short positions, with the target at the September low of 0.8378 and in zone 2 are relevant.

Support and resistance

Resistance levels: 0.8515, 0.8635, 0.8745.

Support levels: 0.8405, 0.8330, 0.8190.

Trading tips

Long positions may be opened above 0.8555, with the target at 0.8700 and stop loss 0.8505. Implementation period: 9–12 days.

Short positions may be opened below 0.8383, with the target at 0.8190 and stop loss 0.8460.