Current trend

The USD/CHF pair is trading in a correction trend at 0.8829 amid the negative dynamics of the American currency.

The Swiss currency is confidently strengthening after the publication of macroeconomic statistics. The leading sectors of the country’s economy reached lows but have now indicated a reversal. Thus, this week, investors will pay attention to the July leading indicators index from the Swiss Economic Institute (KOF), which considers twelve indicators related to consumer confidence, production, new orders, and the real estate market, and also reflects the development outlook for the next six months. The indicator may remain at 102.6 points, the highest level since February 2022, and emphasizes the economic recovery. Inflation data is due in the second half of the week, based on which the Swiss National Bank officials may decide to continue cutting the interest rate from 1.25% to 1.00%, which will be the second consecutive adjustment to the value and will be possible if the consumer price index falls below 1.3%.

The American dollar is correcting at 104.00 points in the USDX. The market reacted neutrally to the personal consumption expenditure indices: the core indicator excluding food and energy was unchanged YoY, amounting to 2.6% in June, having strengthened by 0.2% MoM. Investors were disappointed by the data on personal income, which in June grew by only 0.2% after 0.4% earlier, and the expenditure indicator changed from 0.4% to 0.3%. Thus, consumers in the USA continue to restrain spending, expecting a possible price increase in the future.

Support and resistance

On the daily chart, the trading instrument is approaching the support line of the downward channel with boundaries of 0.8920–0.8670.

Technical indicators are holding the sell signal: fast EMA on the Alligator indicator are moving away from the signal line, and the AO histogram is forming correction bars in the sell zone.

Resistance levels: 0.8880, 0.9040.

Support levels: 0.8800, 0.8660.

Trading tips

Short positions may be opened after the price declines and consolidates below 0.8800, with the target at 0.8660. Stop loss — 0.8900. Implementation period: 7 days or more.

Long positions may be opened after the price grows and consolidates above 0.8880, with the target at 0.9040. Stop loss — around 0.8800.