USD/CHF Price Analysis: Will USD bulls push the pair to parity?
05.05.2022, 20:21

USD/CHF Price Analysis: Will USD bulls push the pair to parity?

  • The USD/CHF recovered all the ground shed post-Fed and is gaining 1.32%.
  • A dismal market mood, spurred by the central bank’s tightening, and China’s covid crisis, threatens to disrupt the global economic recovery.
  • USD/CHF Price Forecast: If USD/CHF bulls reclaim 0.9900, a move towards parity is on the cards.

The Swiss franc is losing ground against the buck, and the USD/CHF continues to reach a new YTD high after each of the last seven trading sessions amidst a dismal market mood. At 0.9852, the USD/CHF is rallying in the day, though retreated from early daily and current YTD highs around 0.9890.

Wall Street is in a middle of a stock blood bath, as reflected by the market sentiment. Central bank “aggressive” tightening, elevated US Treasury yields and a possible economic slowdown in China, spurred by the zero-tolerance Covid-19 policy, keep investors on their toes.

In the case of the USD/CHF, the pair reversed Wednesday’s profits after dipping to weekly lows reached on May 2 at around 0.9713 but staged a comeback and at the time of writing, is probing May 4 daily high at 0.9852.

USD/CHF Price Forecast: Technical outlook

The USD/CHF is upward biased from a daily chart perspective, as shown by the daily moving averages (DMAs) sitting below the exchange rate. However, the Relative Strength Index (RSI), well within the overbought territory at 79.01, might suggest that the pair is about to peak, nevertheless, it is aiming higher.

With that said, the USD/CHF’s first resistance would be March’s 23 daily high at 0.9901. Once cleared, the next step would be the parity at 1.000.

 

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