Current trend

After Friday’s publication of statistics on the US labor market, the USD/CHF pair continued to decline, preparing to renew the May low of 0.8833.

Thus, in June, the American economy created only 209.0K new jobs outside the agricultural sector compared to 306.0K (revised from 339.0K) earlier, significantly lower than the consensus forecast of 225.0K. The wages increased by 0.4%, while the previous figure corrected from 0.3% to 0.4%. The indicator rose by 4.4% YoY, slightly higher than the expected 4.2%, while unemployment renewed its low of 3.6% from 3.7% earlier. The negative data led to a revision by experts of forecasts regarding further tightening of the US Federal Reserve’s monetary policy.

In Switzerland, inflation fell to 1.7% YoY in June, below the forecast of 1.8% and the previous value of 2.2%: it may put pressure on the franc, as against the negative dynamics of the indicator, the Swiss National Bank is unlikely to raise the interest rates.

Thus, investors can expect that the long-term downtrend in the USD/CHF pair will continue. Today, market participants are testing the May low at 0.8833, after the breakdown of which the decline may continue to the 2021 low at 0.8769 and further to 0.8670. The nearest resistance level is around 0.9003, in case of correction to which it is worth considering short positions with the target at 0.8833.

The medium-term trend is downward: this week, the price reached zone 2 (0.8839–0.8811), after consolidation below which the next sell target will be zone 3 (0.8590–0.8566). The trend border is shifting to the levels of 0.9109–0.9082, upon reaching which within a correction, short positions with the target in zone 2 (0.8839–0.8811) are relevant.

Support and resistance

Resistance levels: 0.9003, 0.9110, 0.9212, 0.9330.

Support levels: 0.8833, 0.8770, 0.8670.

Trading tips

Short positions may be opened from 0.9003 with the target at 0.8833 and stop loss around 0.9060. Implementation period: 9–12 days.

Long positions may be opened above 0.9060 with the target at 0.9212 and stop loss around 0.9000.