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FxWirePro- USDCHF Monthly Outlook

USDCHF trades in a narrow range between 0.94290 and 0.93412 for the past three days. It was one of the best performers s previous month and surged  350 pips on board-based US dollar buying.  It gained momentum after upbeat US Nonfarm payroll data, ISM services, and US retail sales.  USDCHF hits a high of 0.94396 at the time of writing and is currently trading around 0.94181.

 

The US manufacturing PMI jumped to 47.70 last month from 47.4 in Jan, below the estimate of 48. ISM manufacturing prices rose to 51 from a forecast of 45.

 

Major economic data:

 

US Initial jobless claims

 

According to the CME Fed watch tool, the probability of a 50 bpbs rate hike in Mar increased to 30% from 24% a week ago.

 

 The US 10-year yield surged sharply and holds above 4%, the highest level since Nov. The US 10 and 2-year spread widened to -89 basis points from -77% bpbs.

 

Technically in the 4-hour chart, the pair is holding above short-term (21 and 55 EMA) and above long-term 200 EMA (0.92611). Any close above 0.94320 (21 M EMA) confirms further bullishness; a jump to 0.94725/0.9500/0.9540/0.9600 is possible. Significant bullish continuation only if it breaks 0.9600.

 

 The near-term support is around 0.93800, any breach below targets is 0.93500/0.9300/0.9230.

 

Indicators (4-hour chart)

 

CCI (50)- Bullish

 

ADX- Bullish

 

It is good to buy on dips around 0.9380 with SL around 0.9270 for the TP of 0.9600.

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