USD/CHF Price Analysis: Pair recovers from recent losses, struggles to approach 0.8900

• USD/CHF holds ground above 0.8850 on the back of recovery in the Greenback.
• MACD suggests that recent momentum is stronger; regains August’s highest level.
• 21-day EMA emerges as the key support lined up with 23.6% Fibo at 0.8799.

USD/CHF snaps the previous day’s losses, trading higher around 0.8870 during the early trading hours in the European session on Tuesday. The pair experiences upward support due to the firmer US Dollar (USD) and Swiss downbeat Gross Domestic Product (GDP) for the second quarter (Q2) of 2023.

As said, the Swiss GDP reduced to 0.0% against the market consensus of 0.1%, which was recorded at 0.3% in the previous quarter. Additionally, the Greenback strengthens as investors appear to accept the potential nearing end of the interest rate-hike cycle by the US Federal Reserve (Fed).

The Moving Average Convergence Divergence (MACD) line remains above the centerline and the signal line, which indicates that recent momentum is stronger.

The pair could face a challenge around August’s high at 0.8876 level, followed by the 0.8900 psychological level.

On the flip side, the 21-day Exponential Moving Average (EMA) at 0.8807 could act as the immediate support, lined up with the 0.8800 psychological level and 23.6% Fibonacci retracement at 0.8799.

A firm break below the latter could open the doors for the USD/CHF pair to navigate the area around the 0.8750 psychological level.

In the short term, the USD/CHF pair remains to be bullish as long as the 14-day Relative Strength Index (RSI) stays above 50.

USD/CHF: Daily Chart