Fundamental Analysis of USD/CHF for May 3, 2018

USD/CHF has been non-volatile with the bullish gains since it broke and retested the 0.9450 area. Recently published positive economic reports on the USD side did help the currency to dominate CHF in the process whereas CHF was struggling with worse economic reports.

Ahead of the high impact economic reports to be published tomorrow including NFP, Average Hourly Earnings, and Unemployment Rate, Today USD Non-Farm Productivity report is going to be published which is expected to increase to 0.9% from the previous value of 0.0%, Prelim Unit Labor Cost is expected to increase to 3.1% from the previous value of 2.5%, Unemployment Claims report is expected to increase to 225k from the previous figure of 209k and Trade Balance report is expected to have less deficit by increasing to -50.0B from the previous figure of -57.6B. Additionally, USD Final Services PMI report is going to be published which is expected to be unchanged at 54.4, ISM Non-Manufacturing PMI is expected to decrease to 58.1 from the previous figure of 58.8, Factory Orders are expected to increase to 1.3% from the previous value of 1.2% and Natural Gas Storage report is expected to show an increase to 47B from the previous negative figure of -18B.

On the other hand, recently CHF SECO Consumer Climate report was published with decrease to 2 which was expected to be unchanged at 5, Retail Sales decreased to -1.8% from the previous value of -0.2% which was expected to increase to 0.3% and Manufacturing PMI report was published with an increase to 63.6 from the previous figure of 60.3 which was expected to decrease to 59.9.

As of the current scenario, the market sentiment has been favoring USD along the way whereas the mixed economic reports published on the CHF side fueled the USD to gain more momentum in the process. Ahead of the upcoming series of high impact economic reports to be published today and tomorrow, USD is expected to be quite volatile with its gains while trying to sustain the bullish momentum in the pair. Despite the economic reports results of USD which are forecasted to have mixed results, CHF is expected to regain some momentum along the way for a certain period of time before USD takes the lead again in the future.

Now let us look at the technical view. The price is currently residing at the edge of 1.00 resistance area from where it is expected to push lower towards 0.9850 and later towards 0.97 in the coming days. Certain Bearish Divergence has been spotted along the way which is expected to add to the probability of upcoming bearish momentum in the pair. As the price remains below 1.00 area, a certain bearish pressure is expected in this pair for the coming days.

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The material has been provided by InstaForex Company - www.instaforex.com