USD/CHF is under pressure. Although the pair posted a rebound, it is still trading below its key resistance at 1.0110, which should limit the upside potential. The downward momentum is further reinforced by a declining 50-period moving average. The relative strength index is mixed to bearish.
The U.S. Labor Department announced that 235,000 nonfarm payrolls were added in February, higher than +197,000 expected. The jobless rate ticked down to 4.7% from 4.8% in January, while average private-sector hourly wages gained 0.2% on month, compared with +0.3% expected. The U.S. dollar headed to the downside despite a robust February jobs report. According to CME Group, Federal-funds futures showed the odds of a rate increase in March at 93%. However, it was widely believed that a March rate increase was already largely priced in by the markets, and investors were already looking ahead to the pace of further increases.
To conclude, as long as 1.0110 holds on the upside, look for a further drop to 1.0055 and even to 1.0035 in extension.
Resistance levels: 1.0135, 1.0160, and 1.0190
Support levels: 1.0055, 1.0035, and 1.00
