Usdchf consolidates as us and swiss economic concerns weigh in

USDCHF Analysis

Performance after Wednesday
Period	Pct	Chg	Momentum
Wednesday	0.19%	17.4 Pips
Week to-date	-0.4%	-35.5 Pips
February	-1.77%	-160.8 Pips

Upcoming key events (London Time)

Thu 08:00 AM CHF GDP (seasonally adjusted) (3-mth)
Thu 01:30 PM USD GDP annual rate
Fri 01:30 PM USD PCE Price Index, excluding food and energy (12-mth)

What happened lately

In the United States, the economic data exhibited a concerning trend with January’s New-Home Sales Change dropping to a stark -10.5% from a previously revised figure of 8.1%. This dip could suggest a weakening in the housing market, a critical component of the domestic economy. Further reinforcing signs of stagnation, the U.S. House Price Index for December showed no change, holding steady at 0.4% compared to November. Stability in house prices may indicate a plateau or sluggishness in real estate appreciation, affecting investor sentiment and household wealth, which are pivotal for consumer spending and economic growth.

Meanwhile, in Switzerland, the ZEW Financial Market Survey reflected a significant decline from 17.7 points in January to 3.4 points in February. This reduction signals diminished confidence among financial market experts regarding Switzerland’s economic prospects. Such a decline may cast a shadow on anticipations of future economic activity and financial sector health, potentially impacting investment inflows and economic dynamism.

Regarding the currency pair USDCHF, on Wednesday, it saw a rise by 0.19% to 0.89454, indicating a period of consolidation amidst the ongoing economic events. The decline in the U.S. housing market statistics might put downward pressure on the USD, with potential to offset this through upcoming critical economic releases, such as the GDP and PCE Price Index figures. Simultaneously, the loss of optimism surrounding the Swiss financial markets could weigh on the CHF, potentially maintaining or amplifying the strength of the USDCHF pair. However, the balance of this pair will highly depend on how these nations’ respective economic landscapes unfold post the imminent GDP announcements, with investors likely to scrutinize these indicators for future positioning.

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What can we expect from USDCHF today?

USDCHF on Wednesday rose 0.19% to 0.89454. Price is below 9-Day EMA while Stochastic is rising in oversold zone.

Updated daily direction for USDCHF looks mixed as the pair is likely to consolidate above 0.89193 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 0.89646 or trades above daily pivot 0.89419. Break above could target R1 at 0.89681. While to the downside, we are looking at 0.89193 (S1) and daily low of 0.89158 as support levels. USDCHF need to break on either side to indicate a short-term bias. A break above 0.89646 may suggest continuation after recent positive movement.

For the week to-date, take note that USDCHF is bearish as the pair posted lower by -0.4%.

Key levels to watch out:

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