USDCHF
The breakout in USDCHF above .9043 has hit its first target at .9288. With the Fed turning hawkish in its dot plot forecasts and revising it s inflation forecasts higher, the USD short position has been sharply unwound and looks to have further to go. Traders will be keeping a close eye on incoming data now with upside surprises likely to spur the USD rally onward.
On the other hand, the SNB has reaffirmed its commitment to maintaining easing in place holding rates at -0.75% in a bid to curtail excessive strengthening of the Franc. The SNB’s message this week comes despite rising inflationary pressures in the country and draws a distinct contrast between its own monetary policy and that of the Fed’s, which now looks increasingly likely to begin down the path to normalisation this year.
Key Data to Watch
Next week, the focus will be on Fed chair Powell who testifies before the senate as well as the US PMI data due on Wednesday. Traders will be keen to see if Powell gives any hawkish signals and will be watching data for any upside surprises.
Technical Views
USDCHF
The rally in USDCHF has seen price hitting the .9189 initial target. With MACD and RSI firmly bullish here, the focus is on further upside with the .9288 level the next bull target. Look for any short term correction from this level to find support into a retest of the broken highs around .9095.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.