Swiss Franc Short-term Outlook: USD/CHF Bulls Eye the Break

Swiss Franc Technical Forecast: USD/CHF Short-term Trade Levels

• USD/CHF threatens to snap five-day advance – key resistance within striking distance
• USD/CHF weekly opening-range intact ahead of key U.S. inflation data (CPI)
• Resistance 9210/39 (key), 9300, 9373 - Support 9073, 8989-9009 (key), 8900

The US Dollar rallied more than 1.4% against the Swiss Franc since the start of the month / year with USD/CHF struggling today on the heels of a five-day advance. The weekly opening-range is set just above slope support with major US inflation data on tap tomorrow- battles lines drawn on the USD/CHF short-term technical charts.

Swiss Franc Price Chart – USD/CHF Daily

Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView

Technical Outlook: In last month’s Swiss Franc Short-term Outlook we noted that USD/CHF was, “testing support at the September uptrend- looking for inflection into this zone over the next few days with the weekly range intact just above.” The bears failed to break support the following day with a USD/CHF surging more than 5.3% off the December lows. The rally has been testing uptrend resistance for the past two-days with bears threatening to snap a five-day winning streak.

The immediate focus is on this advance towards key resistance at 9210/39- a region defined by the October 2023 high-day close (HDC) and the 50% retracement of the broader 2022 decline. Note that basic channel resistance converges on this threshold over the next few days and a breach / close above is needed to fuel the next major leg of the advance.

Swiss Franc Price Chart – USD/CHF 240min

Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView

A closer look at Swisse price action shows USD/CHF trading within the confines of an ascending pitchfork extending off the September low with the weekly opening-range taking shape just above the median-line / 2024 high-day close (HDC) at 9157. A break below this slope would threaten a deeper pullback within the uptrend towards the objective yearly open at 9073 and the May / January lows at 8989-9009- losses would need to be limited to this threshold for the multi-month advance to remain viable (bullish invalidation).

A topside breach / close above 9239 is needed to mark uptrend resumption with such a scenario exposing subsequent resistance objectives at the upper parallel (currently near ~9300) and the November 2021 high / August 2022 low at 9373. The next major technical consideration is eyed at the 2016 swing low / 61.8% retracement at 9444/53- look for a larger reaction there IF reached.

Bottom line: The USD/CHF rally is extending into uptrend resistance near the 92-handle early in the month. From a trading standpoint, a good zone to reduce portions of long-exposure / raise protective stops- losses should be limited to the monthly range lows IF price is heading higher on this stretch with a close above 9239 needed to fuel the next leg of the advance.

Keep in mind that we get the release of key U.S. inflation data this week with the December Consumer Price Index (CPI) on tap tomorrow. Stay nimble into the release and watch the weekly close for guidance here. Review my latest Swiss Franc Weekly Forecast for a closer look at the longer-term USD/CHF technical trade levels.

USD/CHF Key Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

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--- Written by Michael Boutros, Sr Technical Strategist

Follow Michael on X @MBForex