Today’s free forex signals service is a buy on the USD/CHF as we expect the market to observe the Dollar’s upside in the wake of Fed’s hawkish stance on tapering.
The USD/CHF pair remains under pressure of around 0.9250, disregarding the status quo of the Swiss National Bank. Despite a general decline in the US dollar, this caused the spot price to drop 0.22% that day to 0.9235.
The USD/CHF pair primarily remained affected by the FOMC, Greenback weakness after Evergrande news that triggered risk-on sentiment and the SNB’s rate decision.
The Federal Open Market Committee kept interest rates at 0.00% to 0.25% per annum in line with consensus. However, the authority indicated that interest rates may rise sooner than expected. Additionally, the market was looking for clues about the beginning of the “tapering” process.
During the traditional press conference after the Fed’s monetary decision was announced, Chairman Jerome Powell said that the “tapering” process could be completed in mid-2022, adopting a hawkish stance in contrast to other meetings. However, the date of the commencement of tapering was not stated.
This Thursday, the Swiss National Bank (SNB) decided to leave the monetary policy parameters unchanged when assessing monetary policy for the September quarter.
As expected, the SNB left its key interest rate at -0.75% and its three-month Libor target range unchanged at -1.25% to -0.25%.
Technically, the USD/CHF pair remains below the key moving averages, heading towards the 0.9200 local lows. We are looking for a buying opportunity if the price manages to stay above the 0.9250 area and hits the 0.9278 mark, which is a level above the key resistance line. If it triggers, we expect the price to rally towards the 0.9300 level and above. The hawkish stance of the Fed may reverse the Greenback losses.
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Free forex signals – Buy USD/CHF at 0.9278
Instrument: USD/CHF
Order Type: BUY STOP
Entry price: 0.9278
Stop Loss: 0.9212
TP1: 0.9377
Our Risk Setting: 1%
Risk / Reward Ratio: 1:1.5
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Saqib Iqbal
