The USD/CHF pair remains under some selling pressure for the fourth successive day on Friday and languishes near its lowest level since January 2021 touched the previous day. The pair trades just below the 0.8900 round figure during the early European session and seems vulnerable amid the underlying bearish sentiment surrounding the US Dollar (USD).

The Relative Strength Index (RSI) on the daily chart is flashing slightly oversold conditions and holding back traders from placing fresh bearish bets. Investors now look to the US macro data - Retail Sales figures and the Preliminary Michigan Consumer Sentiment Index - for a fresh impetus.

From a daily chart perspective, the USD/CHF might continue to fall further, though buyers stepped in at around 0.8871, the February 16 cycle low. Although the USD/CHF fell beyond the latter, it bounced strongly, as USD/CHF bulls look forward to reclaiming the 0.8900 figure.

Short term, the USD/CHF 4-Hour chart suggests the pair is consolidating once it formed a doji, just below the S2 daily pivot point around 0.8888. For a bearish continuation, the USD/CHF needs to dive below 0.8859 to extend its losses toward the S3 pivot point at 0.8832, ahead of falling to 0.8800.

Although oscillators like the Relative Strength Index (RSI) and the Rate of Change (RoC) maintain a bearish bias, the RSI is in oversold territory. Hence, an upward correction is likely, though buyers must reclaim the 0.8900 figure.

Once achieved, the USD/CHF next resistance would bet the S1 pivot point at 0.8925, followed by the confluence of the daily pivot point and the 20-day EMA at 0.8975/80 before testing 0.9000.

A clear downside break of an eight-month-old descending support line, now immediate resistance around 0.8930, directs USD/CHF bears toward the year 2021 low near 0.8760.

Bulls are going to drive USDCHF towards DEMA20&50

Apr 14 2023