Fundamental Overview:
USD/CHF is expected to trade in a higher range after hitting a one-year high at 0.9335 on Friday. USD/CHF is undermined by the weaker dollar sentiment after fewer-than-expected 142,000 increase in U.S. August non-farm payrolls (versus forecast +225,000). The unemployment rate slipped to 6.1% last month from 6.2% in July, in line with forecast, but that came as the labor-force participation rate fell to 62.8% from 62.9% in July, it is also weighed by the lower shorter-dated U.S. Treasury yields (2-year at 0.512% versus 0.536% late Thursday as the U.S. yield curve steepened); and franc demand on soft EUR/CHF cross. But USD/CHF downside is limited by the contagion from weak EUR on CHF, dovish Swiss National Bank's monetary policy and franc sales on buoyant AUD/CHF, NZD/CHF crosses.
Technical Comments:
The daily chart is still positive-biased as MACD is bullish, stochastics stays elevated in the overbought zone, 5 and 15-day moving averages are advancing.
Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 0.9345 and the second target at 0.9380. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.9250. A break of this target would push the pair further downwards and one may expect the second target at 0.9210. The pivot point is at 0.9290.
Resistance levels:
0.9345
0.9380
0.9425
Support levels:
0.9250
0.9210
0.9175
The material has been provided by InstaForex Company - www.instaforex.com
