![](https://blog.trive.co.za/wp-content/uploads/2024/02/inv-1024-x-512-px-2024-02-13T115158.491.png)
Today marks a crucial juncture for the USDCHF currency pair, with both economies unveiling their latest inflation figures. The day commenced with Switzerland’s inflation release, revealing a year-over-year figure that fell short of expectations, registering at 1.3% instead of the anticipated 1.7%. Similarly, month-over-month inflation disappointed, coming in at 0.2% rather than the expected 0.6%, though it did mark an improvement from the previous month’s 0%.
This dovish report weakened the Swiss Franc, pushing the currency pair meaningfully higher. As the day progresses, anticipation remains high as the spotlight shifts to the United States. Forecasts predict a decline in yearly inflation from 3.4% to 2.9%, with core inflation following suit, expected to decrease from 3.9% to 3.7%. The stage is set for continued volatility, ensuring an engaging day ahead in the currency markets.
Technical
On the 4H chart, a clear uptrend has emerged following the breakout from a descending channel pattern. The 25-SMA (green line) trades above the 50-SMA (blue line) and 100-SMA (orange line), confirming the bullish presence. However, volumes are declining, signalling that the uptrend could be running out of steam.
Resistance at 0.8808 could be the level to watch in the upcoming session, as a daily close above this level could signal that the bullish run in the early session has backing. Resistance at 0.8826 could then become important, as it could be the next hurdle to the bullish momentum going forward. With the RSI ticking into overbought conditions, a pullback may be initiated here.
However, if the session closes below the 0.8808 level, the bullish run may be overextended. In this case, a pullback toward 0.8791 and 0.8770 could become likely. The 25-SMA offers further support near 0.8745 and could provide a challenging hurdle for the bears to cross to initiate a sustainable pullback. If they are successful, the currency pair could trickle down toward the 50-SMA near 0.8701.
![](https://blog.trive.co.za/wp-content/uploads/2024/02/image-50.png)
Summary
While the US inflation could be the main driver for the day, the Swiss Franc provided some movement in the early session as its inflation data disappointed. The movement around 0.8808 could be pivotal in the upcoming session to determine whether the recent bullish run is becoming overextended.
Sources: Koyfin, Tradingview, Reuters
Piece written by Tiaan van Aswegen, Trive Financial Market Analyst
Disclaimer: Trive South Africa (Pty) Ltd (hereinafter referred to as “Trive SA”), with registration number 2005/011130/07, is an authorised Financial Services Provider in terms of the Financial Advisory and Intermediary Services Act, 37 of 2002. Trive SA is authorised and regulated by the South African Financial Sector Conduct Authority (FSCA) and holds FSP number 27231. Trive Financial Services Ltd (hereinafter referred to as “Trive MU”) holds an Investment Dealer (Full-Service Dealer, excluding Underwriting) Licence with licence number GB21026295 pursuant to section 29 of the Securities Act 2005, Rule 4 of the Securities Rules 2007, and the Financial Services Rules 2008. Trive MU is authorized and regulated by the Mauritius Financial Services Commission (FSC) and holds Global Business Licence number GB21026295 under Section 72(6) of the Financial Services Act. Trive SA and Trive MU are collectively known and referred to as “Trive Africa”.
Market and economic conditions are subject to sudden change which may have a material impact on the outcome of financial instruments and may not be suitable for all investors. Trive Africa and its employees assume no liability for any loss or damage (direct, indirect, consequential, or inconsequential) that may be suffered. Please consider the risks involved before you trade or invest. All trades on the Trive Africa platform are subject to the legal terms and conditions to which you agree to be bound. Brand Logos are owned by the respective companies and not by Trive Africa. The use of a company’s brand logo does not represent an endorsement of Trive Africa by the company, nor an endorsement of the company by Trive Africa, nor does it necessarily imply any contractual relationship. Images are for illustrative purposes only and past performance is not necessarily an indication of future performance. No services are offered to stateless persons, persons under the age of 18 years, persons and/or residents of sanctioned countries or any other jurisdiction where the distribution of leveraged instruments is prohibited, and citizens of any state or country where it may be against the law of that country to trade with a South African and/or Mauritius based company and/or where the services are not made available by Trive Africa to hold an account with us. In any case, above all, it is your responsibility to avoid contravening any legislation in the country from where you are at the time.
CFDs and other margin products are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how these products work and whether you can afford to take the high risk of losing your money. Professional clients can lose more than they deposit. See our full Risk Disclosure and Terms of Business for further details. Some or all of the services and products are not offered to citizens or residents of certain jurisdictions where international sanctions or local regulatory requirements restrict or prohibit them.