USD/CHF Rebound Emerges amid Failure to Test January Low

US Dollar Outlook: USD/CHF

USD/CHF carves a series of higher highs and lows following the failed attempt to test the January low (0.8966).

USD/CHF Rebound Emerges amid Failure to Test January Low

USD/CHF stages a three-day rally as it extends the rebound from the monthly low (0.9002), and the exchange rate may continue to track the positive slope in the 50-Day SMA (0.9014) as it still holds above the moving average.

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As a result, USD/CHF may further retrace the decline from the monthly high (0.9197) amid the limited reaction to the weaker-than-expected US Non-Farm Payrolls (NFP) report, but the semi-annual testimony from Federal Reserve Chairman Jerome Powell may influence the exchange rate as the central bank pauses its rate-cutting cycle.

US Economic Calendar

In turn, more of the same from Chairman Powell may drag on the Greenback as the Federal Open Market Committee (FOMC) moves towards a neutral stance, but an adjustment in the forward guidance for monetary policy may fuel the recent recovery in USD/CHF should the prepared remarks tame speculation for lower US interest rates.

With that said, USD/CHF may attempt to test the January high (0.9201) should it continue to track the positive slope in the 50-Day SMA (0.9014), but the exchange rate may face range bound conditions if it struggles to retrace the decline from the monthly high (0.9197).

USD/CHF Price Chart – Daily

Chart Prepared by David Song, Senior Strategist; USD/CHF Price on TradingView

• USD/CHF retraces the decline from the monthly high (0.9197) as it bounces back ahead of the January low (0.8966), with a breach above the January high (0.9201) bringing the 2024 high (0.9225) on the radar.
• Next area of interest comes in around the October 2023 high (0.9245), but another failed attempt to close above 0.9180 (23.6% Fibonacci extension) may curb the recent series of higher highs and lows in USD/CHF.
• Lack of momentum to hold above the 0.9030 (38.2% Fibonacci extension) to 0.9040 (23.6% Fibonacci extension) region may push USD/CHF towards the January low (0.8966), with the next area of interest coming in around the 0.8880 (38.2% Fibonacci retracement) to 0.8910 (38.2% Fibonacci extension).

Additional Market Outlooks

USD/JPY Rebound Keeps RSI Above Oversold Zone Ahead of Fed Testimony

Canadian Dollar Forecast: USD/CAD Remains Susceptible to Trump Tariffs

AUD/USD Recovery Stalls Ahead of January High

US Dollar Forecast: EUR/USD Snaps Back Ahead of January Low

--- Written by David Song, Senior Strategist

Follow on Twitter at @DavidJSong