- Fed’s George signals toward two more rate hikes in 2018.
- US Dollar Index sticks to recovery gains above 95.
- Markit Manufacturing & Services PMI from the U.S. will be watched next.
After closing the first three days of the week with losses, the USD/CHF pair seems to have steadied above the 0.98 handle on Thursday as the selling pressure on the USD eases with the Jackson Hole symposium going underway. At the moment, the pair is virtually unchanged on the day at 0.9830.
Earlier today, while speaking to Bloomberg TV on the sidelines at the Jackson Hole Symposium, Kansas Fed President Esther George said that two more rate hikes would be appropriate this year. Commenting on President Trump’s criticism of the Fed’s monetary policy, George said that Trump’s remarks wouldn’t influence the Fed’s decision to raise rates.
Later in the session, new home sales will be published ahead of IHSM Markit’s manufacturing and service sector activity report. The US Dollar Index, which tested the 95 mark twice on Wednesday, recorded modest recovery gains on Thursday and was last seen at 95.28, where it was up 0.2% on the day. In case today’s data reminds the markets that the U.S. economy remains strong, we could see the buck gather strength in the second half of the day.
Technical outlook
Losses the pair recorded since Monday dragged the RSI indicator on the daily chart into the oversold area near the 30 mark, which suggests that sellers are likely to stay on the sidelines before the pair makes a correction. On the downside, supports could be seen at 0.9800 (psychological level), 0.9745 (Apr. 23 low) and 0.9670 (Apr. 19 low). Resistances align at 0.9850 (daily high), 0.9935 (50-DMA) and 1.0000 (psychological level).
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