FX.co ★ USD/CHF

US Dollar (USD) extends its Friday gains against the Swiss Franc (CHF) on Monday, trading around the 0.7250 level in the USD/CHF pair, while the two-week high of 0.7270 is nearby. On Monday, markets are directionless with investors unwilling to take any substantial bet in USD, prior to the Federal Reserve’s interest rate decision, expected late this week. Analyst Christ Turner from ING notes that “interest rate spreads have shifted a bit against the Dollar due to the US tech pullback, reducing expectations for US Fed tightening.” Nevertheless, he also points out that “energy prices continue holding on to their highs,” along with the fact that “the third US warship group has arrived in the Gulf, increasing risks of escalation in the Middle East.” This factor, according to ING, will help support the USD, despite the change in interest rate markets pricing. USD/CHF is trading at 0.8250, preserving a cautiously bullish stance following a strong impulse move higher off the 0.8190 region on Friday. The momentum is positive as RSI(14) is currently positioned slightly above the mid-level while MACD has made a moderately positive print. It will be interesting for bulls to see the reaction around the high from October 19 and 20 near 0.8270 before the low from October 13 and 14 at 0.8315 and the new year-to-date high near 0.8400 made in mid-October. As for the support level, the 0.8230 region is defending bids so far on Monday, in the Asian session, thus blocking any further decline toward the mentioned 0.8191 low from Friday. Below it, the focus shifts to the September 1 high at 0.8156.