USD/CHF Price Analysis: Slumps below the 200-DMA, bears target the 50-DMA

• USD/CHF bounces off the 50-DMA support at 0.8957, currently trading near 0.8987.
• The 200-DMA at 0.9014 is a significant resistance, capping the pair's upside.
• Slowing inflation in Switzerland initially boosted the pair towards 0.9200.
• A recent decline in US bond yields, combined with a double-top pattern, has pressured the pair downwards.

The USD/CHF extended its losses towards the 50-day moving average (DMA) at 0.8957, though bounced off at that level, and finished Wednesday’s session at around 0.8987, capped on the upside by the 200-DMA. As Thursday’s Asian session begins, the major exchanges hands at 0.8987, almost flat.

Revisiting the USD/CHF after a week's absence, the pair trades in between the 50 and 200-DMA, with the latter at around 0.9014, exerting downward pressure on the pair. As inflation in Switzerland continued to slow down, traders bought the pair, lifting prices toward 0.9200. But the recent fall in US bond yields sparked the major’s recent leg down, coupled with a double-top chart pattern.

Given the backdrop, the USD/CHF pair is trading sideways. A break below the 50-DMA would expose the 0.8900 figure, followed by a September 11 swing low test of 0.8893. On the other hand, if USD/CHF reclaims the 200-DMA, the pair could rally and test the latest cycle high of 0.9088 before launching an attack toward the month-to-date (MTD) high of 0.9245.

USD/CHF Price Action – Daily chart

USD/CHF Technical Levels