This dollar pair has been trading sideways recently but also appears to be forming a short-term reversal pattern.
So, will USD/CHF stay stuck in consolidation or can it go for an uptrend soon?
Better keep this neckline resistance level on your radar!
USD/CHF 4-hour Forex Chart by TradingView
What’s next for the U.S. dollar now that the Fed surprised the markets with a 0.50% rate cut and signaled more easing to come?
USD/CHF tossed and turned during the actual announcement and presser but eventually resumed its climb closer to its range resistance visible on the 4-hour time frame.
Can the pair keep rallying past this ceiling?
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on the U.S. dollar and the Swiss franc, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
As you can see from the chart above, the range resistance is close to the .8550 minor psychological mark, R1 (.8550) and the 200 SMA dynamic inflection point, which means that it could attract sellers to jump in. If so, keep an eye out for a move back to the range support near the .8400 handle and S1 (.8420).
On the other hand, a break above the near-term resistance could complete what appears to be a triple bottom reversal pattern.
In this case, stay on your toes in case long green candlesticks suggest that sustained bullish vibes are in play, potentially taking USD/CHF up to the next upside targets at R2 (.8600) then R3 (.8680).
Lastly, keep in mind that the Swiss National Bank (SNB) is scheduled to make its monetary policy announcement this week and that another interest rate cut is eyed, so this could spark additional volatility for USD/CHF and correlated forex pairs.
Don’t forget to practice proper risk management and stay aware of top-tier market catalysts when trading this one. Good luck!