USD/CHF’s upswing from the previous week has taken the pair to a key technical resistance level this week.
Can the bulls maintain their momentum?
Or is USD/CHF ready to extend a longer-term trend?
USD/CHF: 4-hour
![USD/CHF 4-hour Forex](https://bpcdn.co/images/2024/06/26235734/USDCHF.png)
USD/CHF 4-hour Forex Chart by TradingView
As you can see, USD/CHF has been making lower highs and lower lows since the start of May when the pair hit resistance at the .9200 psychological area.
The downtrend took the pair to its .8840 lows last week, but the Swiss National Bank’s (SNB) surprise interest rate cut encouraged some CHF selling. It also didn’t hurt USD bulls when a round or risk aversion hit the markets and upped the demand for the U.S. dollar.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your fundie homework on the U.S. dollar and the Swiss franc, then it’s time to check out the economic calendar and stay updated on daily fundamental news!USD/CHF is now trading just above the .8950 psychological level, which isn’t too far from the R1 (.8982) Pivot Point line, the 4-hour chart’s 200 SMA, and the top of a descending channel that’s been around since the downtrend started.
Are we looking at a pullback opportunity for USD/CHF bears?
A couple of bearish candlesticks or consistent trading below the R1 Pivot Point line opens the possibility of a downswing that may take USD/CHF back to the .8900 psychological handle. And, if there’s technical and fundamental momentum behind it, USD/CHF may even drop to its .8840 lows before extending its downtrend!
But if the pro-USD, anti-CHF persists in the next few days, then USD/CHF may extend its upswing instead.
Look out for bullish candlesticks or sustained trading above the descending channel and R1 Pivot Point areas as they could lead to an upside breakout for USD/CHF.
What do you think? Which way will USD/CHF trade in the next few days?