The US dollar fell against the Swiss franc on Monday, dragging the price of USDCHF to less than 0.9692 amid upbeat Swiss employment news.
After a big surge in the price of USDCHF on Friday, the bears are looking set to take control of the market today. The pair opened the Asian session at 0.9725. Amid the Swiss employment figure, investors looked cautious. Both the buyers and sellers were reluctant in trading.
As of this writing, the pair is being traded around 0.9697. On the upside, the pair may get restricted by the yearly high at 0.9741. A break above this level could open the way towards the 0.9780 handle.
On the downside, a strong support may be noted around 0.9620, the psychological number and trend line support as demonstrated in the above chart. We can see the next strong support at 0.9550, again the psychological number and confluence of trend line and 50% fib level.
The overall bias is bullish because of higher lows on the daily chart. The bias is expected to remain bullish as far as the support around 0.9390 remains intact.
The Swiss employment level remained at 4.227M this quarter as compared to 4.196M in the same quarter of the year before. Released by Swiss Statistics, the employment level represents the economic expansion. A higher figure represents the positive economic expansion and is thus seen as bullish for the Swiss Franc and vice versa. The better than previous outcome supported bearish momentum in the price of USDCHF.
Markit Services PMI
The US market services PMI is expected to remain at 56.8 points in November, lower than 57.1 of the previous month, the average forecast of analysts says. As an indicator of overall economic conditions, a high reading is considered positive for the US dollar and vice versa thus a better than expected reading will be seen as bullish for USD/CHF.
In the light of technical and fundamental analysis, selling around the current levels could be a good strategy in short to medium term with a tight stop placed at 0.9740.
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