USD/CHF Reacts to SNB Rate Cut: A Bearish Outlook Prevails

The currency pair gained sharply after SNB cut rates by 25 bpbs. It hit an intraday high of 0.88276 and is currently trading around 0.88185. The intraday bias appears to be bearish as long as the resistance 0.9000 holds. 

On 20 March 2025, the Swiss National Bank reduced its policy rate by 25 basis points to 0.25%, from 21 March, in response to muted inflationary pressures, which have fallen from 0.7% in November to 0.3% in February, and steady inflation forecasts of 0.4% in 2025 and 0.8% in 2026-2027. The SNB projects moderate world economic growth with Swiss GDP rising between 1% and 1.5% in 2025, besides expressing readiness to intervene in foreign exchange markets to stabilize the value of the Swiss franc. This adjustment indicates the SNB's focus on price stability in the light of dubious world economic conditions

Technical Analysis and Resistance Levels

The pair is trading below the 34-EMA and 55-EMA on the 4-hour chart indicating a bearish trend. The immediate resistance is at 0.8865 any break above targets 0.8890/0.8940/0.9000/0.9035/0.9070/0.9100/0.9150/0.9200/0.92250/0.9275/0.9300. 

Support Levels and Potential Declines

On the downside, near-term support is around 0.8750, any violation below will drag the pair to 0.8720/0.8660/0.8600.

Bullish Indicators

CCI (50) - Bearish
Directional movement Index - Neutral

Trading Strategy Recommendation

It is good to sell on rallies around 0.8850-525 with a stop-loss at 0.8890 for a TP of 0.8720.