Search ForexCrunch
  • DXY jumps to 2019 highs on Thursday.
  • ECB’s dovish shift triggers a heavy EUR/USD sell-off.
  • Risk-off mood causes pair to limit its losses.

The USD/CHF pair broke out of its daily trading range in the early NA session and touched its highest level since mid-February at 1.0088 boosted by a broadly stronger USD before going into a consolidation phase in the last hour. As of writing, the pair is trading at 1.0078, adding 0.3% on a daily basis.

The European Central Bank at its March meeting decided to change its forward guidance on the timing of the next rate hike and said that rates were expected to stay at their current levels. Furthermore, President Draghi announced that the Governing Council cut its 2019 growth forecast to 1.1% from 1.7% seen in December. The shared currency came under heavy selling pressure on Draghi’s remarks and slumped to its lowest level since mid-November, boosting the demand for the greenback.  

Earlier in the session, the data from the U.S. revealed weekly jobless claims decreased by 3K to 223K in the week ending February 25 and the unit labour costs in the fourth quarter rose by 2% to surpass the market expectation of 1.6% to provide additional support to the buck. At the moment, the DXY is near its 2019 highs, adding 0.48% on the day at 97.35.

On the other hand, the ECB’s cautious tone weighed on the market sentiment and caused European stocks to post large daily losses, helping the CHF show some resilience as a safe-haven.

Technical levels to consider

USD/CHF

Trends:
       Daily SMA20:  1.0023
       Daily SMA50:  0.995
       Daily SMA100:  0.9963
       Daily SMA200:  0.9913
Levels:
       Previous Daily High:  1.0057
       Previous Daily Low:  1.0031
       Previous Weekly High:  1.002
       Previous Weekly Low:  0.9926
       Previous Monthly High:  1.01
       Previous Monthly Low:  0.9921
       Daily Fibonacci 38.2%:  1.0047
       Daily Fibonacci 61.8%:  1.0041
       Daily Pivot Point S1:  1.0033
       Daily Pivot Point S2:  1.0019
       Daily Pivot Point S3:  1.0007
       Daily Pivot Point R1:  1.0059
       Daily Pivot Point R2:  1.0071
       Daily Pivot Point R3:  1.0085