The US Dollar remains under strong bearish pressure against the Swiss Franc, hammered by the downward revision of the third quarter US Gross Domestic Product released on Thursday.
The US economy grew at a 4.9% pace in Q3, below the previous estimation of a 5.2% growth. At the same time, the Philadelphia Fed manufacturing Survey revealed a deterioration of the sector´s firms and US Price Consumption Expenditures declined against expectations in November.
These figures confirm the soft landing view that cements market hopes of Fed cuts in early 2014, and sent US Treasury yields and the US Dollar back to recent lows.
Against this backdrop, the market is awaiting the release of a batch of key US indicators later today, with a special interest in the US PCE Prices Index. A weaker-than-expected reading would strengthen the case for imminent Fed cuts and increase negative pressure on the USD.
The USD´s bias is negative, confirmed by Thursday´s bullish engulfing candle and there is no clear sign of a trend shift in sight. The pair has pierced a long-term low at 0.8555 and might extend to 0.8500.
At those levels, RSI indexes would be at extremely oversold levels which allows for some correction. Resistances are at 0.8590 and 0.8635.
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