Fundamental overview:
USD/CHF is expected to consolidate with a bullish bias after hitting four-year high 1.0108 Monday. USD/CHF is underpinned by bullish USD sentiment (ICE spot dollar index hit nine-year high 91.775 Monday, last at 91.39) amid expectations that the U.S. economy will pull ahead of the rest of the world this year and that the Federal Reserve would start raising interest rates in coming months ahead of other major central banks as well as a jump in U.S. ISM-NY business index to 70.8 in December from 62.4 in November, weaker--than-expected Switzerland December PMI of 54.0 (versus forecast 54.3), franc sales on soft CHF/JPY cross and on buoyant AUD/CHF, NZD/CHF and CAD/CHF crosses, and ultra-loose Swiss National Bank's monetary policy.
Technical comment:
Daily chart is positive-biased as MACD is bullish, stochastics stays elevated at overbought levels, five and 15-day moving averages are advancing.
Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 1.0140 and the second target at 1.0180. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.9980. A break of this target would push the pair further downward, and one may expect the second target at 0.9930. The pivot point is at 1.0030.
Resistance levels:
1.0140
1.0180
1.0210
Support levels:
0.9980
0.9930
0.99
The material has been provided by InstaForex Company - www.instaforex.com
