Current trend

During the Asian session, the USD/CHF pair is developing an active “bullish” trend in the ultra-short term, formed last week, when it retreated from the annual lows, renewed against a sharp weakening of the American currency, and is testing the level of 0.8675.

Traders are waiting for the key macroeconomic statistics from the United States. Today at 14:30 (GMT 2), July data on production inflation is due, which, according to forecasts, will reflect a slowdown in the overall indicator from 2.6% to 2.3% and the core indicator from 3.0% to 2.7%. The consumer price index is due on Wednesday at 14:30 (GMT 2). Experts expect the core value to change from 3.3% to 3.2% and the broader indicator from 3.0% to 2.9%. A further weakening of inflation risks will contribute to the launch of the US Fed’s interest rate cut program during the September meeting.

On Thursday, investors will pay attention to the Swiss production inflation index. The July value may increase from –1.9% to –1.7% YoY and from 0.0% to 0.2% MoM. On Friday, statistics on the dynamics of industrial production are due. According to preliminary estimates, the Q2 indicator will change from –3.1% to –2.9%.

Meanwhile, the youth wing of the Social Democrats (JUSO) has come out with an initiative to increase taxes on the country’s super-rich residents, which will help finance measures to mitigate the effects of climate change. In particular, they propose to collect half of the transferred assets exceeding 50.0M francs. Isabel Martinez, a senior economist at the Swiss Economic Institute (KOF), notes that there are currently about 2.5K people in the country with a fortune of more than 50.0M francs, which is less than 0.1% of all taxpayers with total payments of about 5.0B–7.0B francs per year or 6.0% of income from taxes on income, profits and capital gains.

Support and resistance

On the daily chart, Bollinger bands are steadily declining: the price range is actively narrowing, reflecting the emergence of corrective growth. The MACD indicator is rising, maintaining a strong buy signal (the histogram is above the signal line). Stochastic approached the highs and is trying to reverse into a horizontal plane, indicating that the American dollar may become overbought in the ultra-short term.

Resistance levels: 0.8673, 0.8700, 0.8730, 0.8776.

Support levels: 0.8630, 0.8600, 0.8559, 0.8500.

Trading tips

Long positions may be opened after a breakout of 0.8700, with the target at 0.8776. Stop loss — 0.8660. Implementation period: 2–3 days.

Short positions may be opened after a breakdown of 0.8630, with the target at 0.8559. Stop loss — 0.8673.