The Swiss National Bank abandoned in January its long-standing policy of capping the franc's strength, sending the currency sky-high and raising concerns about its impact on the export vulnerable Swiss economy.
The US dollar started last week on a strong footing continuing to feed off expectations, fuelled by the latest Federal reserve minutes, that the central bank might raise rates as soon as June. The currency then gave back its gains and pushed lower against its major counterparts. The release of disappointing US data initiated concerns over the strength of the economy, fuelling uncertainty over the timing of a rate hike.
This week on the economic calendar we have From the US the New Home sales in March that is expected to fall from 0.539M to 0.523M and the Durable Goods Orders in March, that is expected to rise from -1.4% to 0.8%.
USD/CHF fell during Friday’s session, trading again below the 200-day moving average and close near the low of the day on a narrow range day. The pair is in a phase change from warning to a distribution phase. The stochastic is showing bearish momentum.
Expecting downward move to 0.09327 on a break below Friday’s low at 0.94936 (scenario 1) or a break above Friday’s high at 0.9584 could throw price to a daily resistance at 0.9657 (scenario 2).
