USDCHF Analysis
| Performance after Tuesday | |||||
| Period | Pct | Chg | Momentum | ||
| Tuesday | -0.48% | -44 Pips |  |
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| Week to-date | -0.52% | -48.1 Pips |  |
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| January | 0.98% | 88.4 Pips |  |
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Upcoming key events (London Time)
Wed 01:30 PM USD CPI Inflation Rate (12-mth) Thu 01:30 PM USD Monthly Retail Trade (1-mth)
What happened lately
In the United States, the Monthly Treasury Budget Statement showed an improvement in December, with the deficit reducing from -$367 in November to -$87. This signifies a positive trend in government finances, potentially indicating a decrease in government borrowing requirements. Meanwhile, the Producer Price Index (PPI) statistics for December show a mixed picture. The PPI excluding food and energy sectors saw no change on a monthly basis, remaining at 0% compared to 0.2% in November, while the 12-month PPI index increased slightly from 3.0% to 3.3%. The general PPI for December decreased to 0.2% from 0.4% the previous month, indicating a slowdown in the production cost growth rate. Notably, the PPI excluding food and energy sectors over the 12-month period increased marginally from 3.4% to 3.5%. This mixed economic data points to mild inflationary pressures and a slightly improving fiscal situation.
These economic developments in the U.S. might affect the USDCHF currency pair. The improvement in the fiscal budget could strengthen the U.S. dollar as it indicates a healthier financial position for the government and possibly reduced need for additional borrowing. However, the mixed results in the PPI could temper this effect, as stable or slightly rising production costs suggest controlled inflation, which might not necessitate aggressive monetary policy changes by the Federal Reserve. Moreover, if the upcoming U.S. CPI inflation data or the monthly retail trade figures show significant deviations from expectations, they could further influence market sentiment. Overall, the current data points to a modest support for the USD, but traders will also be closely monitoring upcoming high-impact events to gauge potential shifts in monetary policy and their subsequent impact on the USDCHF pair.
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What can we expect from USDCHF today?
USDCHF on Tuesday dropped -0.48% to 0.91196. Price is above 9-Day EMA while Stochastic is falling.
Updated daily direction for USDCHF looks bearish as the pair posted lower in Tuesday trading session.
Looking ahead for the day, immediate support level is at S1 0.90976 with break below could see further selling pressure towards S2 at 0.90757. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 0.91737 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 0.91137 would indicate selling pressure.
For the week to-date, take note that USDCHF is mixed as compared to the prior week.
Key levels to watch out:
| R3 | 0.92176 |
| R2 | 0.91957 |
| R1 | 0.91576 |
| Daily Pivot | 0.91357 |
| S1 | 0.90976 |
| S2 | 0.90757 |
| S3 | 0.90376 |
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