The United States Dollar/Swiss Franc currency pair (also referred to as USDCHF and USD/CHF) is one of the most actively traded in the world. In this article, we will examine how USDCHF is performing.
USDCHF Key Stats
- 2021 high: 0.9472
- 2021 low: 0.8757
- YTD high: 1.0064
- YTD low: 0.9091
- YTD % change: +5.57%
USDCHF Forecast
Despite usually being seen as a safe haven, the energy-related issues in Europe and economic instability have resulted in the USD being the go-to currency for investors, which resulted in a move higher for the USDCHF so far in 2022. However, in recent months we have seen lower highs and lows, suggesting the trend is beginning to turn around, but we are not so sure. Nevertheless, with aggressive rate hikes still in play and the US economy remaining resilient in times of adversity, we see a USD move higher in the near to mid-term, with the level around 0.9830, our initial target.
USDCHF Fundamental Analysis
During times of economic uncertainty, the US dollar is one of the go-to currencies. The strength of the US economy and its status as the world’s reserve currency make it the place investors go when the market and general economy are in decline.
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When it comes to day-to-day fundamental analysis for the USD, it is essential to keep an eye on the major economic data releases that occur each week and month. Factors and data such as payroll data, GDP, retail sales, non-farm payrolls, and much more are all drivers of the US economy and will impact currency movements. These releases help central bankers, the government, traders, investors, economists, and others assess the current health of the US economy. As of now, inflation has been a vital issue in the US and most other economies, and the recent reading came in above expectations causing stocks to fall once again and FX traders to flock to the USD safe haven. In addition, there is now talk that the Fed will raise rates by 100bps, which would give additional value to the USD.
The Swiss franc is considered a stable currency across the global economy. Due to its political and financial stability and its low-interest rates, it has been a desirable currency for investment. It has also been a currency investors move to during times of worry in the global economy. Moreover, the Swiss Central Bank is known to take measures to control the currency’s value. The Swiss National Bank this year raised its interest rate for the first time in 15 years as it tightened its monetary policy to restrain inflation, while it recently stated that its next rate move is not yet settled following a hike by the ECB.
USDCHF Technical Analysis
As mentioned earlier, the USDCHF, after hitting highs not seen since 2019, has begun creating lower highs in recent months, suggesting a move to the downside is brewing (despite the fact we believe it will move higher once again). Price also recently bounced from the key level around the 0.9530 mark, while the recent low also touched the 200MA before rising. The 200MA on the daily chart looks to be acting as a solid trendline to keep an eye on, and a move below that moving average will invalidate our near-term upside view.
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