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USDCHF Quotes are Retreating from the Resistance Level of 0.932

2/22/2023 1:22 PM

After testing the resistance level of 0.9320 last week, the USD/CHF pair is actively declining, trading at 0.9260.

The downtrend will likely continue in the long term as Swiss inflation rises. According to the latest data, the indicator increased from 2.8% to 3.3% in January against the forecast of 2.9%. In the current situation, the interest rate of the Swiss National Bank at 1.00% is not enough to contain the negative trend. Therefore, at the next meeting on March 23, the regulator will likely raise the rate by 0.25% or 0.50%. Any tightening of monetary policy will strengthen the national currency, but before that, the asset is likely to be corrected, as investors expect the “hawkish” rhetoric from the US Federal Reserve and a shift in the maximum rate peak above 5.00%.

The long-term trend remains downward. Now, the trading instrument is in correction, having retreated to 0.9250 after testing 0.9320. The breakout of 0.9320 during the week will allow quotes to rise to 0.9420, after which the correction may continue to the area of 0.9520.

The medium-term trend is downward, but now an upward correction is developing with the target at 0.9396–0.9364, after the test of which it will be possible to consider new sales with the target at the February low in the 0.9060 area. The breakout of the key resistance 0.9396–0.9364 will allow the trend to change upwards with the target at zone 2 (0.9725–0.9691).

Resistance levels: 0.9320, 0.9420, 0.9520. | Support levels: 0.9155, 0.9089, 0.9030.

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