The USDCHF tumbles for the second straight day and falls beneath the 50-day Exponential Moving Average (EMA) as the American Dollar gets battered across the board amidst a risk-on impulse underpinning risk-perceived assets. Furthermore, US Treasury yields sank, undermining the greenback. At the time of writing, the USDCHF is trading at 0.9860, below its opening price by 0.15%.

A jump in China’s daily coronavirus number, the biggest one since May 01, joins the market’s anxiety amid the US mid-term elections buzz and could be considered the main catalyst behind the recent swing in the mood.

The USDCHF remains neutral-to-downward biased, even though the major dived since last Friday, when the USDCHF fell short of testing the YTD high at 1.0147, plunging almost 190 pips, after the release of US employment figures. However, the data was mixed, bolstered speculations that the US Federal Reserve will slow the pace of rate hikes.

Since then, the USDCHF extended its losses by more than 1.20%, and the 50-day EMA at 0.9852 is acting as support at the time of typing. So if USDCHF sellers achieve a daily close below the latter, that would expose the 100-day EMA at 0.9734, and the USDCHF will need to hurdle some key support levels.

Therefore, the USDCHF's first support would be the 50-day EMA, followed by the psychological 0.9800 figure. Once cleared, the next support would be the October 6 daily low at 0.9708, followed by the 100-day EMA.

On the upside, the USDCHF first resistance would be 0.9900. Break above will expose the parity, followed by the 1.0100 figure.

USDCHF to opt for a temporary recovery

Nov 08 2022

Stop Loss -0.50%

Holding time 1d15hr

0.98345

Entry price

0.97850

Stop loss price