USD/CHF Price Forecast: Looks to build on strength beyond 0.7800 amid firmer USD
The USD/CHF pair attracts some follow-through buying for the second straight day, with bulls looking to extend the momentum further beyond the 0.7800 mark during the Asian session. Spot prices, however, remain within striking distance of a nearly two-month low, touched last Friday, as traders keenly await the release of the latest US consumer inflation figures before placing fresh directional bets.
The crucial US Consumer Price Index (CPI) report will influence expectations about the Federal Reserve's (Fed) policy outlook amid the possibility of a rate hike by the end of this year and drive the US Dollar (USD) demand. In the meantime, rising US-Iran tensions remain supportive of elevated Crude Oil prices, fueling inflation fears and underpinning the USD's reserve currency status. This, in turn, is seen as a key factor acting as a tailwind for the USD/CHF pair.
From a technical perspective, the recent failure to find acceptance above the 200-period Simple Moving Average (SMA) on the 4-hour chart and the subsequent slide favor bearish traders. Meanwhile, the price action has stabilised off recent lows, and the Relative Strength Index (RSI) has nudged above the midline towards 53, while the Moving Average Convergence Divergence (MACD) histogram has turned mildly positive but is yet to offset the weight of the trend barrier.
Furthermore, the broader structure still suggests a capped recovery, with the USD/CHF pair retaining a bearish bias in the near term. Hence, any further move up is likely to confront significant resistance near the 200-period SMA at 0.7873. A sustained break above this level would be needed to ease the current downside pressure and open the door to a more durable rebound. Until then, the USD/CHF pair remains vulnerable to renewed selling on rallies.
(The technical analysis of this story was written with the help of an AI tool.)
USD/CHF 4-hour chart
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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