- The US dollar has rallied a bit against the Swiss franc during the early hours on Tuesday, but we are still in a range.
- When you zoom out on the chart, you can see just how important this range is.
- If we can never get beyond the 0.92 level significantly, this thing is going to take off like a rocket.
At that point, I would anticipate the US dollar going to the 0.95 level, followed by the parity level. In the meantime, though, we do have some work to do because the 0.92 level has been like a brick wall. There are some questions about whether or not the Federal Reserve will be able to cut rates this year.
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And I think at this point in time, it's very likely that either they don't, or they may at the very end of the year. Inflationary numbers just aren't dropping quickly enough. And although we get CPI numbers on Wednesday, that might show a little bit of a dip. The trajectory is still higher over the longer term. The 0.90 level underneath, for me at least, is significant support, especially with the 50-day EMA sitting right there as well. As long as we stay above that area, I still look at this as a buy on the dip type of market, but I recognize that it's going to be a very choppy market. Every time we've gotten between the 0.90 and the 0.92 levels, it always gets noisy. However, when you look at the longer term chart again, this is an area that matters. If we break above the 0.92 level significantly, you could, at least in theory, start talking about an 800 pip range based on the W pattern.
The ”Measured Move.”
Well, where does that get you? It gets you right to the parity level. This is not a quick moving pair, so that might be a story for the end of the year or maybe even the middle of next year, you just don't know. But you get paid to hang on to the USD/CHF pair and that's something to keep in the back of your mind as well. I remain bullish, although I recognize we may get a little bit of volatility between now and the true launch.
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