USD/CHF has been in a sharp selloff for the past couple of weeks, mostly due to US dollar weakness, but the sell forex trading signal is still present. Price has started pulling up after dipping close to the .8850 minor psychological support.
The Fibonacci retracement levels on the 1-hour time frame indicate that the pullback might last until the 38.2% level, which lines up with a former support area and the 200 SMA (simple moving average). However, price already seems to be finding resistance at the 100 SMA at the moment, with stochastic reflecting overbought conditions and giving a short forex trading signal.
A selloff from those areas could last until the .8850 area once more if the non-farm payrolls release today turns out weaker than expected.
Forex Trading Signal Forecast
The US dollar had a bit of a relief rally in recent trading, thanks to stronger than expected ADP non-farm employment change data, which set the tone for a stronger NFP release today. The US economy is set to print its NFP figure on Thursday instead of a Friday because of the Fourth of July holiday.
There have been no reports released from Switzerland, leaving the franc sensitive to euro zone data. The biggest market mover for this currency today might be the ECB rate decision, during which traders could keep tabs on Draghi’s remarks during the press conference. No actual monetary policy changes are expected this time since the ECB just cut several rates in their latest statement.
Reassuring remarks from Draghi could renew demand for the Swiss franc and allow it to advance to the dollar, with a bleak NFP reading likely to give a forex trading signal to sell the US dollar. Bear in mind though that volatility could pick up in today’s US trading session, with traders likely to book profits ahead of the long weekend.
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