USDCHF, Market Update
This week, the USD/CHF pair falls to the level of 0.9200 against the backdrop of the publication of the minutes of the US Federal Reserve's Open Market Committee, which generally reflected the "dovish" rhetoric.
Regulatory officials agreed that it would be appropriate to lift monetary easing faster than expected if inflation does not ease, but meeting minutes did not reinforce investor expectations for a 50 basis point rate hike at the upcoming March meeting. Also, the global outflow of capital into shelter assets due to the escalating Russian-Ukrainian conflict led to a decrease in the yield of US bonds and, as a result, a downward correction in the US dollar.
Economic data increased the dynamics of sales of the US currency. The volume of New Homes Sales for January decreased by 4.1% and amounted to 1.638M. Initial Jobless Claims unexpectedly increased and amounted to 248K against the forecast of 219K, and the previous value of the indicator was corrected upward from 223K to 225K. Philadelphia Fed manufacturing index was worse than expected and amounted to 16.0 points against the forecast of 20.0 points.
Today, investors expect the publication of US Existing Home Sales for January. The indicator may decrease by 1.0% compared to the previous month. Negative statistics from the US, together with disappointing reports from the regulator, are pushing the pair to February lows in the 0.9177 area. If traders break through this support level, a deep decline in quotations down to 0.9089 is possible in the medium term.
Support and resistance
The long-term trend remains upwards. The key support is at 0.9177, and holding it will allow the rate to rise to 0.9270. A breakdown of the level of 0.9177 will allow sellers to lower the price to 0.9089.
The medium-term trend is upwards, and now traders are testing the key support area 0.9222–0.9178, holding which will allow renewing the highs of January around the target zone 2 (0.9341–0.9329). The breakdown of the key support will change the trend to a downtrend and mark a new target in the zone of 0.9104–0.9093.
Resistance levels: 0.9250, 0.9270, 0.9339, 0.9360.
Support levels: 0.9177, 0.9089, 0.9033.