The USD/CHF pair fell slightly during the course of the session on Tuesday, but found more than enough support below to turn things back around and form a very positive looking candle. As you can see on the chart, I have a highlighted area near the 0.98 handle, which of course is a large, round number that causes quite a bit of psychological support.
This is also the scene of the 61.8 Fibonacci retracement level. Because of that, it makes sense that a lot of traders would have been interested in this area, and then when you add to that the idea of that it was previously resistive, it makes a lot of sense that we saw some buying of the US dollar. After all, the US dollar has been relatively strong over the longer term, and of course the Swiss franc continues to lose strength overall.
FOMC Statement Today
The FOMC Statement comes out later today, and that can move the markets quite drastically. After all, we will get an interest-rate announcement, and then more importantly get an idea as to what the Federal Reserve will be doing in the future. If they look ready to continue raising interest rates, that could really put quite a bit of momentum underneath the uptrend in this market again. On the other hand, the other thing you have to keep in mind is that the Swiss economy is struggling due to the fact that the European Union is struggling. Overall, I feel that the US dollar will continue to strengthen against quite a few currencies around the world, and the Swiss franc of course won’t be any different.
Any pullback at this point in time will more than likely offer buying opportunities, at least on short-term charts. I have no interest whatsoever in shorting this market, so having said that I feel that this is a “one-way market.”
