Usdchf remains in consolidation amid mixed us economic reports and anticipation of fed rate decision

USDCHF Analysis

Performance after Tuesday
Period	Pct	Chg	Momentum
Tuesday	0%	0.4 Pips
Week to-date	-0.33%	-29.5 Pips
January	0.09%	8.2 Pips

Upcoming key events (London Time)

Wed 07:00 PM USD Fed Interest Rate Decision (Federal Funds Rate)
Thu 01:30 PM USD GDP annual rate

What happened lately

The U.S. House Price Index for November showed a decrease to 0.3%, a dip from previous months, indicating a slowing trend in the housing market. This decline follows after a revised 0.5% and a 0.4% increase reported in previous months for the same index. On the other hand, U.S. durable goods new orders showed a sharper decline of -2.2% in December, worsening from the revised -1.2% figure for November. This drop in durable goods orders might reflect a slowing manufacturing sector, given that it initially showed a minor drop of -1.1% before revisions. Notably, orders excluding transportation edged up by 0.3% in December after November’s decrease, indicating a mixed performance in specific sectors. Defense-excluded orders showed a concerning drop to -2.4% in December, a marked contrast from a revised -0.4% in November. Additionally, non-defense capital goods orders excluding aircraft fell to 0.5% in December, sliding from a revised 0.9% for November. However, U.S. new-home sales illustrated some positive momentum with a 3.6% increase in December, albeit slower than the 5.9% notched in November.

The economic reports illuminate a mixed outlook for the U.S. economy, with particular concerns in the durable goods sector dragged by transportation and defense-related orders. In terms of the USDCHF currency pair, the consolidation experienced at 0.90389 on Tuesday suggests traders are awaiting critical announcements such as the U.S. Fed Interest Rate Decision and GDP annual rate, both of which carry significant potential for volatility. The upcoming Federal Funds Rate decision and GDP rate are particularly pivotal, as they will provide insights into future monetary policy and economic growth potential. If the Fed signals a hike in interest rates or the GDP reflects strong growth, it might attract more investors to U.S. assets, thereby strengthening the U.S. dollar. Conversely, weaker-than-expected reports could pressure the USD, possibly leading to further depreciation against the Swiss franc. Therefore, these forthcoming economic events will play an essential role in shaping trader sentiment and potentially shifting USDCHF from its current consolidation phase.

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What can we expect from USDCHF today?

USDCHF on Tuesday dropped 0% to 0.90389. Price is below 9-Day EMA while Stochastic is rising.

Updated daily direction for USDCHF looks mixed as the pair is likely to consolidate above 0.90225 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 0.90707 or trades above daily pivot 0.90466. Break above could target R1 at 0.9063. While to the downside, we are looking at 0.90225 (S1) and daily low of 0.90302 as support levels. USDCHF need to break on either side to indicate a short-term bias. A close below 0.90302 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:

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