USD/CHF is expected to prevail its Upside movement. The pair is posting a rebound, and is expected to continue its bounce. The 20-period moving average has just crossed above the 50-period moving average, which is a bullish technical signal. And the relative strength index is above its neutrality area at 50 and is positively oriented. The U.S. dollar managed to recuperate losses seen earlier in the session thanks to dip-buying on the currency.
As long as 0.9905 is not broken below, further bounce is expected with 0.9990 as the next target.
As expected, the U.S. Federal Reserve kept interest rates unchanged. The Institute for Supply Management (ISM) reported that its national factory activity index increased to 56.0 in January, the highest level since November 2014, from 54.5 in December. Automatic Data Processing (ADP) data showed that employers added 246,000 private jobs in January (vs. +168,000 expected, +151,000 in December). The U.S. dollar surrendered gains made earlier in the session after the Federal Reserve shed little light on its plans to raise interest rates this year.
As long as this key level holds on the upside, look for a further drop to 0.9860 and even 0.9830 in extension.
Resistance levels: 0.9970, 0.9990, and 1.0010
Support levels: 0.9885, 0.9860, 0.9830
The material has been provided by InstaForex Company - www.instaforex.com