USD/CHF Forecast – US Dollar Recovery Won’t Be Easy Vs Swiss Franc

USD/CHF Forecast – US Dollar Recovery Won’t Be Easy Vs Swiss Franc

  • – The US Dollar stated a downtrend after trading close to 0.9699 against the Swiss Franc.
  • – There is a bearish trend line with resistance at 0.9565 on the hourly chart of the USD/CHF pair.
  • – Today in the US, the Net Long-Term TIC Flows for May 2017 was released by the US Department of Treasury.
  • – The outcome was above the forecast, as the net flows were $91.9B, more than the expectation of $20.3B.

 

US Net Long-Term TIC Flows

Today in the US, the Net Long-Term TIC Flows for May 2017 was released by the US Department of Treasury. The market was expecting the Net Long-Term TIC Flows to be around $20.3B, compared with the last $1.8B.

 

The actual result was above the forecast, as the net flows were $91.9B, more than the expectation of $20.3B. The last reading was also revised up from $1.8B to $9.7B.  On the other hand, the total Net TIC Flows were down from the last revised reading of $74.4B to $57.3B. The report added that:

The sum total in May of all net foreign acquisitions of long-term securities, short-term U.S. securities, and banking flows was a monthly net TIC inflow of $57.3 billion.  Of this, net foreign private inflows were $87.2 billion, and net foreign official outflows were $29.9 billion.

 

Overall, the USD/CHF may continue to move higher, but it is facing a major resistance zone near 0.9560-70.

 

USD/CHF Technical Analysis

The US Dollar struggled to break above the 0.9690-0.9700 levels against the Swiss Franc and moved down. During the downside move, the USD/CHF pair broke the 100 hourly simple moving average and a bullish trend line at 0.9650 on the hourly chart.

 

USD/CHF Technical Analysis US Dollar Swiss Franc

 

The pair traded as low as 0.9523 and currently correcting higher. It has managed to move above the 23.6% Fib retracement level of the last decline from the 0.9632 high to 0.9523 low.

 

However, there are many hurdles on the upside such as 0.9565 and 0.9580. There is also a bearish trend line with resistance at 0.9565 on the hourly chart. Moreover, the 38.2% Fib retracement level of the last decline from the 0.9632 high to 0.9523 low is also near the trend line.

 

So, if the pair continues to move higher, it may face resistance near 0.9565 and 0.9570. Selling rallies can be considered as long as the pair is below the trend line resistance at 0.9570.

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