This week, the pair USD/CHF is traded in the narrow range of 100 points. On Tuesday, after the release of ZEW index in Eurozone, the price tested resistance level of 0.9600, but then, corrected downwards, almost reaching the bottom of the limit (0.9500). Today, Swiss business sentiment index became known. Although this index showed positive dynamics reaching -23.2 points, business climate in Swiss business sector is negative, which puts pressure on the Franc. No more news, which can affect the price, is scheduled for today; on Thursday Swiss trade balance will become known as well as preliminary data on business activity index in the manufacturing sector of the USA as per Markit.
Support and resistance
At the moment the key level of the “bears” is 0.9500. Breakdown of this level will enable the pair to go down to 0.9445 and 0.9380. Otherwise the price can go back to the upper bound of the range at 0.9600.
Technical indicators show sideways trend. Bollinger bands are horizontal. MACD histogram is in the negative zone, its volumes are stable. At the same time Stochastic lines have reversed, showing probability of downward movement.
Support levels: 0.9500, 0.9445 and 0.9380.
Resistance levels: 0.9550 (middle line of Bollinger bands), 0.9600 and 0.9655.
It is recommended to open short positions after breakdown of the level of 0.9500 with the first target of 0.9445 and the next one at 0.9380. Buy orders can be placed above the level of 0.9550 with the targets of 0.9600 and 0.9655.