USD/CHF Tests Resistance Ahead of FOMC Projections
The US dollar has shown strength across the board in anticipation of Wednesday’s rate decision and FOMC projections, leading USD/CHF to approach a key resistance level.
Market Expectations: Higher for Longer
Last week’s unexpected rise in US inflation has raised doubts about whether the Fed will cut rates from 5.5 per cent to 5.25 per cent, as previously expected.
Despite political pressure, the Fed is likely to wait for concrete evidence that inflation has topped out before it starts cutting rates. Moreover, a strong job market and economic growth data have increased confidence in a smooth economic transition, reducing fears of a recession.
This ‘higher for longer’ narrative has seen the greenback strengthen ahead of tomorrow’s Fed Monetary Policy Statement, rate decision and FOMC Economic Projections – taking USD/CHF into a key area of resistance.
USD/CHF: Playing the Range
During the last month, USD/CHF has formed a clear range, with resistance being rejected at the start of March and support holding firm last week.
The recent bout of dollar strength has taken USD/CHF back into resistance – putting reversal traders on alert as we head into tomorrow’s key economic releases.
USD/CHF Daily Candle Chart
Past performance is not a reliable indicator of future results
Lower Timeframe Analysis: Bearish Engulfing Pattern
With USD/CHF retesting resistance we can drop down to the hourly candle chart to analyse the retest in detail.
On this timeframe, we can see that this morning’s price action has formed a large bearish engulfing at the daily resistance zone.
Lower timeframes patterns of this nature can provide effective entry triggers into higher timeframe trade setups.
For more information on how to trade the bearish engulfing pattern effectively, see the link at the bottom of this page.
USD/CHF Hourly Candle Chart
Past performance is not a reliable indicator of future results
Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 84.01% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
https://www.tradingview.com/chart/EURUSD/ZaDWC3LW-Exploring-the-Bearish-Engulfing-Pattern/
Market Expectations: Higher for Longer
Last week’s unexpected rise in US inflation has raised doubts about whether the Fed will cut rates from 5.5 per cent to 5.25 per cent, as previously expected.
Despite political pressure, the Fed is likely to wait for concrete evidence that inflation has topped out before it starts cutting rates. Moreover, a strong job market and economic growth data have increased confidence in a smooth economic transition, reducing fears of a recession.
This ‘higher for longer’ narrative has seen the greenback strengthen ahead of tomorrow’s Fed Monetary Policy Statement, rate decision and FOMC Economic Projections – taking USD/CHF into a key area of resistance.
USD/CHF: Playing the Range
During the last month, USD/CHF has formed a clear range, with resistance being rejected at the start of March and support holding firm last week.
The recent bout of dollar strength has taken USD/CHF back into resistance – putting reversal traders on alert as we head into tomorrow’s key economic releases.
USD/CHF Daily Candle Chart
Past performance is not a reliable indicator of future results
Lower Timeframe Analysis: Bearish Engulfing Pattern
With USD/CHF retesting resistance we can drop down to the hourly candle chart to analyse the retest in detail.
On this timeframe, we can see that this morning’s price action has formed a large bearish engulfing at the daily resistance zone.
Lower timeframes patterns of this nature can provide effective entry triggers into higher timeframe trade setups.
For more information on how to trade the bearish engulfing pattern effectively, see the link at the bottom of this page.
USD/CHF Hourly Candle Chart
Past performance is not a reliable indicator of future results
Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 84.01% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
https://www.tradingview.com/chart/EURUSD/ZaDWC3LW-Exploring-the-Bearish-Engulfing-Pattern/
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.