FxNews – Our USDCHF analysis begins with a comprehensive look at recent market trends and their potential implications. In September 2023, the cost of goods made and imported by Switzerland fell by 1.0 percent compared to the same month in the previous year. This is a more significant drop than the 0.8 percent decrease seen in August 2023.
Bloomberg – This marks the fifth month where prices have fallen, the biggest drop since February 2021. The main reason for this is that the cost of imports kept getting cheaper (a 4.7 percent decrease compared to a 4.1 percent decrease in August), while the prices of goods made in Switzerland eased up a bit (a reduction of 0.9 percent compared to a decline of 1.0 percent).
USDCHF Analysis – 15-Month Fall in Swiss Import Costs
The USDCHF pair has recently exhibited some interesting bearish behavior. The pair tested the 0.382 level on the Fibonacci retracement, a significant event after testing the broken support at the 0.236 level. This is a crucial observation for traders as these levels often serve as strong support or resistance in the market.
The USDCHF price trades within a bearish channel, a development after the bears broke out of the previous bullish channel. This breakout indicates the strength of the bearish sentiment in the market, and traders should note this shift in market dynamics.
Furthermore, the bearish bias is validated with the USDCHF pair trading below the Ichimoku cloud. The Ichimoku cloud is a popular technical analysis tool that comprehensively views the market’s trend, momentum, and support and resistance levels. When a currency pair trades below this cloud, it often signals a bearish trend.
If this bearish momentum continues, the next target for the USDCHF pair would be the 0.5 level of the Fibonacci retracement. This level could be a potential turning point for the pair, and traders should closely monitor how the price behaves around this level.
In conclusion, recent developments in the USDCHF market highlight the importance of using technical analysis tools such as Fibonacci retracements and the Ichimoku cloud in forex trading. By monitoring these key levels and indicators, traders can gain valuable insights into market trends and make more informed trading decisions.
J.J Edwards is a finance expert with 15+ years in forex, hedge funds, trading systems, and market analysis.
