Fundamental overview:
USD/CHF is expected to consolidate with bullish bias after hitting a six-week high of 0.9685 on EBS Wednesday. It is underpinned by the bullish dollar sentiment (ICE spot dollar index hit 11-year high 96.059 Wednesday, last 95.91 versus 95.37 early Wednesday) as stronger-than-expected US February ISM non-manufacturing PMI of 56.9 (versus forecast 56.2) bolstered expectations that the Federal Reserve could raise interest rates by midyear. The pair is also boosted by the rise of 212,000 jobs in the US private sector in February (slightly below the forecast of +215,000, but above 200,000 for the 13th successive reading), the negative Swiss interest rates and the threat of the Swiss National Bank to carry out CHF-selling intervention.
Technical comment:
The daily chart is positive-biased as the MACD and stochastics are bullish, although the latter is at overbought levels. Five- and 15-day moving averages are advancing.
Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 0.9705 and the second target at 0.9735. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.9580. A break of this target would push the pair further downwards, and one may expect the second target at 0.9530. The pivot point is at 0.9615.
Resistance levels:
0.9705
0.9735
0.9780
Support levels:
0.9580
0.9530
0.9495
