USD/CHF Price Analysis: Rebounds to 0.8960 as investors expect hawkish guidance from Fed Powell
28.06.2023, 11:44

USD/CHF Price Analysis: Rebounds to 0.8960 as investors expect hawkish guidance from Fed Powell

  • USD/CHF has shown a recovery move to near 0.8960 as Fed Powell is expected to reiterate the hawkish stance.
  • S&P500 futures have recovered the majority of the gains, portraying a recovery in the risk appetite of the market participants.
  • USD/CHF is jumped to near the horizontal resistance of the Ascending Triangle chart pattern.

The USD/CHF pair has refreshed its day’s high at 0.8964 as the US Dollar Index (DXY) has got back in action ahead of the speech from Federal Reserve (Fed) chair Jerome Powell, which is scheduled at 13:30 GMT.

S&P500 futures have recovered the majority of the gains, portraying a recovery in the risk appetite of the market participants. Investors are digesting expectations from hawkish commentary from Fed Powell as the central bank has already conveyed that two small interest rate hikes are appropriate by year-end. Jerome Powell is widely expected to reiterate its hawkish stance at the European Central Bank (ECB) forum of Central Banking.

The US Dollar Index (DXY) is making efforts for coming out of the woods, which could be done by climbing above the immediate resistance of 102.70.

USD/CHF is jumped to near the horizontal resistance of the Ascending Triangle chart pattern plotted from June 26 high at 0.8969 on an hourly scale. The aforementioned pattern indicates a sheer contraction in volatility. Upward-sloping trendline of the chart pattern is placed from June 26 low at 0.8912.

The Swiss Franc asset has comfortably shifted above the 50-period Exponential Moving Average (EMA) at 0.8948, which indicates that the short-term trend is bullish.

The Relative Strength Index (RSI) (14) is testing territory above 60.00. Confident stability above the same would activate the bullish momentum.

Going forward, an upside move above the psychological resistance of 0.9000 would fade the bearish bias and will drive the asset toward June 06 low at 0.9033 and May 30 high at 0.9084.

In an alternate scenario, a breakdown below May 12 low around 0.8900 would expose the Swiss Franc asset to April 13 low at 0.8860 followed by the ultimate support plotted from May 04 low at 0.8820.

USD/CHF hourly chart

 

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