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USDCHF is Developing the "Bearish" Trend

11/10/2022 12:00 PM

During the Asian session, the USD/CHF pair is moderately declining, developing a "bearish" trend, which formed last Friday after the publication of a controversial report on the US labor market for October, testing 0.9825 for a breakdown.

At the moment, investors are waiting for the release of important macroeconomic statistics from the US on the dynamics of consumer prices, where forecasts suggest a strong growth of the indicator from 0.4% to 0.6% MoM, which, in turn, may affect the policy of the US Federal Reserve since the pace of interest rate increases, in this case, should slow down. However, New York Fed President John Williams said long-term inflation expectations in the country had already stabilized at levels close to the regulator's 2.0% target.

Monetary policy in Switzerland also suggests a further increase in the cost of borrowing. This week, the speech of the head of the National Bank of the country, Thomas Jordan, took place, who said that officials are not striving for a clear target level for inflation, although it is indicated in the range of 0.0–2.0% but are ready soon for the most "active actions" to stabilize the economy.

On the daily chart, Bollinger Bands are actively decreasing: the price range is expanding from below, letting the "bears" renew local lows. The MACD indicator is falling, keeping a stable sell signal (the histogram is below the signal line), and is trying to consolidate below the zero mark. Stochastic, having reached zero a few days ago, reversed into a horizontal plane, indicating that the US dollar may become oversold in the ultra-short term.

Resistance levels: 0.9840, 0.9876, 0.9914, 0.9948. | Support levels: 0.9800, 0.9762, 0.9700, 0.9650.

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