USDCHF H4 Outlook Update The US Dollar (USD) is paring back its losses against the Swiss Franc (CHF) today, Friday, as risk-off sentiment, triggered by the spike in oil prices, outweighs the negative pressure from falling US Treasury yields. USD/CHF is rebounding off the 0.8200 support level and is currently testing Thursday's high of 0.8247, according to the writing, as momentum oscillators lose bearish momentum. Brent Oil prices hit five-month highs above $110.00 on Friday, as Iran's growing control of the Strait of Hormuz and new strikes in Saudi Arabia's oil fields have rekindled concerns about supply issues. Oil at these levels increases pressure on oil-consuming countries like Switzerland. In addition, the yield on the 10-year French OAT bond fell 10 basis points to 5.14% on Thursday, the highest level seen in decades. This has reduced the attractiveness of CHF as a haven against the debt crisis of France, USD/CHF is trading at 0.8242, maintaining a mild short-term bullish bias as it continues its climb from levels above 0.8200 and surpasses the support zone at 0.8230. Technical momentum indicators point to a loss of bearish strength; thus, the 4-hour RSI (14) is back to neutral 50, while MACD turns bullish. If the bulls take control above 0.8230, price action should aim toward the weekly high in the 0.8275 region. A breach of this level negates the bearish trend and brings the October 13 and 14 lows at 0.8315 into play. However, a breakdown below 0.8230 will attract bears to test support near the 0.8185 level (low hit on September 22). Moving further south, the next objective is the mid-August/early September high near 0.8150.
