USDCHF drops 0.51% amid stable US house prices and anticipation of GDP data

USDCHF Analysis

Performance after Tuesday
Period	Pct	Chg	Momentum
Tuesday	-0.51%	-46.2 Pips
Week to-date	-0.63%	-56.5 Pips
February	-1.82%	-165.7 Pips

Upcoming key events (London Time)

Thu 08:00 AM CHF GDP (seasonally adjusted) (3-mth)
Thu 01:30 PM USD GDP annual rate

What happened lately

In the United States, the House Price Index for December did not see any changes, maintaining a steady growth rate of 0.4% as observed in November, according to the Federal Housing Finance Agency (FHFA). This indicates a period of stabilization in the housing market following previous months of volatility. Although a steady HPI growth generally signifies a healthy housing market, it may not be enough to boost economic confidence without additional supportive economic indicators. Observers are now closely watching the upcoming GDP figures, which could provide further insights into the broader economic conditions.

In Switzerland, all eyes are on the upcoming GDP data slated for release shortly. This high-impact data release could provide valuable insights into the health of the Swiss economy, particularly as it may have far-reaching implications for policy decisions. A robust GDP growth could signal strong economic resilience, potentially attracting investors and boosting the Swiss franc’s value. Conversely, a downturn or weaker-than-expected performance might push policymakers towards more accommodative policy measures.

Concerning the USDCHF currency pair, the exchange rate saw a decrease of 0.51% to 0.89280 on Tuesday. This decline could be interpreted in light of the anticipated GDP announcements from both the U.S. and Switzerland. The lack of change in the U.S. House Price Index might have contributed to weakening the dollar’s attractiveness, as investors might prefer to await more definitive economic signals such as the GDP annual rate. Should the U.S. GDP show substantial growth, it may bolster the dollar’s standing against the franc. Alternatively, if the Swiss GDP data reveals robust growth compared to expectations, the CHF may strengthen further against the USD. Therefore, both data releases are critical and are likely to have significant implications for the USDCHF exchange rate in the coming period.

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What can we expect from USDCHF today?

USDCHF on Tuesday dropped -0.51% to 0.89280. Price is below 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 0.89005 with break below could see further selling pressure towards S2 at 0.88731. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 0.89780 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 0.89118 would indicate selling pressure.

For the week to-date, take note that USDCHF is bearish as the pair posted lower by -0.63%.

Key levels to watch out:

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