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USD/CHF Price Analysis: Struggles To Prolong Recovery Above The Supply Zone Between 0.9140 And 0.9160
The USD/CHF is encountering resistance as it attempts to extend its recovery move above the 0.9140-0.9160 supply zone. The Swiss Franc bulls were not bolstered by the SNB chairman's harsh comments. The RSI (14) is having difficulty entering the positive region of 60.00-80.00.
In the early Asian session, the USD/CHF pair rallied following a corrective dip to near 0.9115. As the US Dollar Index (DXY) has moved sideways in advance of the United States Nonfarm Payrolls (NFP) report, it is difficult for the Swiss franc to extend its recent uptrend.
Meanwhile, Swiss National Bank (SNB) Chairman Thomas J. Jordan's hawkish comments failed to bolster the Swiss Franc bulls. As inflationary pressures exceed what the central bank can allow, SNB's Jordan confirmed additional interest rate hikes. The SNB is prepared to engage in currency market activity if necessary.
After three consecutive days of gains, S&P500 futures plummeted during the Asian session, indicating a dramatic reduction in investors' risk appetite. The 10-year US Treasury yields have slipped below 3.40%.
After testing historical lows plotted on an hourly scale from the 18th of January's low of 0.9085, USD/CHF displayed an outstanding comeback. Extremely robust recovery activity brought the asset quickly above the 20- and 50-period Exponential Moving Averages (EMAs) at 0.9120 and 0.9130, respectively.
The Swiss franc has achieved a level close to the supply zone between 0.9140 and 0.9160. Prior to taking a position, it would be preferable to examine the price activity around the supply range.
Also, the Relative Strength Index (RSI) (14) is failing to rise into the bullish region of 60.00-80.00. An occurrence of the same will initiate the upside momentum.
For further upside, the major needs to deliver a confident move above the 0.9140-0.9160 supply zone, which would propel the asset toward January 18 high at 0.9246 followed by January 24 high at 0.9280.
In contrast, a breach of Wednesday's low at 0.9059 will pull the major to the bottom of 4 August 2021 at 0.9018. A slippage below the latter will drive the asset further below 10 May 2021 low at 0.8986.
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