The pair rose sharply after Trump took the lead in the U.S. presidential elections. Overall bias remains bullish as long as support 0.8600 holds. It hit a high of 0.87536 and is currently trading around 0.87470.
The policy divergence between the US Fed and SNB supports the pair at lower levels.
Markets eye US Fed monetary policy tomorrow for further movement.
After Donald Trump's election win, the Federal Reserve may change its money policy. They are expected to cut interest rates by 0.25%, lowering them to 4.75%. Trump's planned policies could increase inflation, possibly reaching 3.4%, which is above the Fed's 2% target. Additionally, Trump's presidency may put more political pressure on the Fed, as he has previously criticized its chair, Jerome Powell.
Technical Analysis
The pair is currently trading above the 34- and 55-EMA on the 4-hour chart
Near-Term Resistance: Current resistance is at 0.8780. A break above this level could lead to targets at 088050,0.8875/0.8900/0.8925. The break above 0.87500 confirms that the decline from 0.9225 was completed at 0.83750.
Immediate Support: The next support level is at 0.8720. If this level is broken, the pair could drop to 0.8660/0.8600/0.8580, 0.8550, 0.8525, 0.8499, 0.8440, 0.8420, 0.8390, 0.8365 (61.8% Fibonacci projection), or even 0.8340.
Indicator Analysis (4-hour chart)
- CCI (50): Bullish
- Average Directional Movement Index: Bullish
Overall, the trend remains neutral
Trading Recommendation
Consider buying on dips around 0.8720, with a stop loss set at 0.8660 and aiming for a target price of 0.8925.
