USDCHF on Friday dropped -0.75% to 0.84031. Week ending 2024-09-27 moved lower by -1.24%. What you need to know.

USDCHF Analysis

Performance
Period	Pct	Chg	Momentum
Friday	-0.75%	-63.9 Pips
Week 2024-09-27	-1.24%	-105.9 Pips
September	-0.78%	-66.3 Pips

Upcoming key events for the new week (London Time)

Mon 06:00 PM Federal Reserve Chair Jerome Powell speech
Thu 07:30 AM Swiss CPI Inflation Rate (12-mth)
Thu 01:30 PM Initial Unemployment Insurance Claims
Fri 01:30 PM Nonfarm Payroll Employment

What happened over the week

In the United States, there were a series of mixed economic data released recently. The Index of Consumer Sentiment, as reported by the University of Michigan, saw a slight improvement in September, increasing to 70.1 points from 69 points in August. On the other hand, consumer spending reflected in Personal Consumption Expenditures (PCE) showed a notable decline, dropping to 0.2% in August from 0.5% in July, according to the Bureau of Economic Analysis. Moreover, the monthly PCE Price Index saw a minor decrease to 0.1% from 0.2%, while the yearly PCE Price Index, excluding food and energy, rose to 2.7% from 2.6%. In terms of GDP, the economy expanded at an annual rate of 3.0% in the second quarter of 2024, as per the U.S. Bureau of Economic Analysis’ third estimate. Also, new durable goods orders experienced a significant drop to 0% in August from a revised 9.9% in July, according to the Census Bureau. Additionally, the Department of Labor reported a minor decrease in initial unemployment insurance claims, dropping to 218,000 for the week ending September 21 from 219,000 the previous week. Lastly, the U.S. House Price Index showed a slight improvement, rising to 0.1% in July from -0.1% in June, based on data from the FHFA.

In Switzerland, the Swiss National Bank (SNB) decided to lower the policy interest rate to 1% from 1.25%. Additionally, the ZEW Financial Market Survey for September saw a significant decline, dropping to -8.8 points from -3.4 points in August, as reported by the ZEW.

The recent developments are likely to affect the USDCHF currency pair. The mixed economic signals from the U.S. demonstrate a blend of positive and negative aspects that could create volatility. The improved GDP growth and consumer sentiment are generally supportive of the U.S. Dollar, but the decline in consumer spending and durable goods orders might suppress this positive impact. On the other hand, the Swiss National Bank’s decision to reduce interest rates and the deteriorating ZEW Financial Market Survey reflect a weaker economic outlook for Switzerland, which typically would weaken the Swiss Franc against the U.S. Dollar. Despite this, USDCHF dropped by 0.75% to 0.84031 on Friday, suggesting possible market adjustments to prevailing economic conditions. However, given the upcoming events, such as the Federal Reserve Chair Jerome Powell’s speech and Swiss CPI Inflation Rate, further volatility is expected. Market participants will closely monitor these events for any cues on future monetary policy actions, potentially influencing USDCHF movements.

From X (Twitter)

Monetary policy assessment: The press release and introductory remarks delivered by the Governing Board members at the news conference are available on our website (in English, German, French and Italian):https://t.co/hXyWrQkQQM pic.twitter.com/zwJBnhorLm

— Swiss National Bank (@SNB_BNS) September 26, 2024

What can we expect from USDCHF for the new week and what happened on Friday?

USDCHF on Friday dropped -0.75% to 0.84. Price is below 9-Day EMA while Stochastic is rising. For the week ending 2024-09-27, the pair dropped -1.24% or -105.9 pips lower.

Looking ahead, USDCHF looks bearish as the pair posted lower in Friday trading session.

For the new week, our technical outlook looks bearish, immediate support level is at 0.84 (WS1) with break below could see further selling pressure towards 0.83 (WS2). For potential buyers, as the current momentum is bearish, we prefer to look at firm break of the week high of 0.85 as an important indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below week low of 0.84 would indicate selling pressure.

For the month of September, USDCHF is down by -0.78% or -66.3 pips lower.

Weekly key levels to watch out:

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Gross Domestic Product (Third Estimate), Corporate Profits (Revised Estimate), and GDP by Industry, Second Quarter 2024 and Annual Update Source: Bureau of Economic Analysis
Powell, Opening Remarks Source: Federal Reserve
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2024-09-26 – Monetary policy assessment of 26 September 2024 Source: SNB
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