Swiss Franc: Further losses seem capped against US Dollar – UOB
UOB’s Quek Ser Leang and Lee Sue Ann note that USD/CHF has surged over the past two days, with strong momentum pointing to further Dollar strength. However, they stress that deeply overbought conditions are likely to cap upside to the 0.8305–0.8330 area.
UOB analysts Quek Ser Leang and Lee Sue Ann observe that the USD/CHF exchange rate has experienced significant gains over the past two days, indicating a strong surge in the US Dollar. However, they caution that the rate may soon reach a cap around the 0.8305–0.8330 range due to the currency pair being deeply overbought. Short-term support levels are identified at 0.8270 and 0.8255, while the overall trend suggests a lack of momentum to recapture the July peak.
In the 24-hour timeframe, the USD has shown an impressive surge, reaching a high of 0.8296 the previous day. This strong momentum suggests that the US Dollar may continue to gain strength, but the overbought conditions may limit any further gains to potentially testing the 0.8305 level. Should the rate fall below 0.8255, it would signal a weakening of the upward pressure.
Looking ahead over the next 1-3 weeks, the analysts have shifted their perspective from positive to neutral. They now anticipate that the USD will trade within a range between 0.8155 and 0.8255. Initially, the USD breached above 0.8255 two days ago, and yesterday, it further rose, reaching a high of 0.8296. Although the renewed upward momentum may allow for further gains, the deeply overbought conditions suggest that any upside is likely to be limited, with a possible test of the 0.8330 level.
The upside potential will persist as long as the USD remains above the crucial 0.8225 support level.
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