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USD/CHF Softens to near 0.7900 with rangebound tone ahead of US CPI release
- USD/CHF weakens to around 0.7905 in Friday’s early European session.
- Further consolidation cannot be ruled out as the pair remains capped below the Bollinger Bands’ 20-day SMA, with neutral RSI.
- The immediate resistance level emerges at 0.7930; the initial support level is seen at 0.7895.
- The US March CPI inflation report is due later on Friday.
The USD/CHF pair loses ground to near 0.7905 during the early European session on Friday. A fragile two-week ceasefire between the United States (US) and Iran provides some support to a safe-haven currency such as the Swiss Franc (CHF) against the US Dollar (USD).
Ahead of the US and Iran talks in Pakistan, Israel continues to bombard Lebanon after killing more than 300 people and injuring at least 1,150 in a single day of strikes across the country on Wednesday. Earlier Friday, Israeli Prime Minister Benjamin Netanyahu said that there is “no ceasefire in Lebanon” and Israel would continue “to strike Hezbollah with full force” as the country’s military launched fresh strikes.
Traders will closely monitor the US March Consumer Price Index (CPI) inflation report later on Friday. The headline CPI is projected to see a rise of 3.3% YoY in March, compared to 2.4% in February, driven by soaring oil prices due to the Middle East war. Any signs of hotter inflation in the US could boost the Greenback against the CHF in the near term.
Technical Analysis:
In the daily chart, USD/CHF is hovering just above the 100-day exponential moving average (EMA) at 0.7893, which lends nearby support, but it remains capped by the Bollinger Bands’ 20-day simple moving average around 0.7932, keeping the broader tone neutral and range-bound. The Relative Strength Index (RSI) at 49 is essentially flat, hinting that directional conviction is lacking after the recent pullback from higher levels.
On the topside, initial resistance is located at the Bollinger midline/20-day SMA near 0.7930, with a break there exposing the upper Bollinger band at roughly 0.8032 as the next hurdle. On the downside, immediate support is seen at the 100-day EMA at 0.7895; a clear break below this level would open the way toward the lower Bollinger band support around 0.7832, where buyers could look to defend the broader range.
