Current trend

After the decision of the Swiss National Bank (SNB) to correct the interest rate by 25 basis points, the USD/CHF pair is unsuccessfully testing the support level of 0.8915.

Frank develops negative dynamics after the publication of comments on monetary policy, which on Saturday gave the SRF television channel the governor of the regulator, Thomas Jordan. According to him, the increase in the cost of borrowing five times in recent months to 1.75% is most likely not enough to bring under control core (excluding fuel and food prices) inflation, which in May was 0.2% MoM and 2.2% YoY. Against this background, the USD/CHF pair may stay above 0.8915.

The long-term trend remains downward but now the price is correcting. At the moment, it is worth considering long positions with the target at 0.9110, after the breakdown of which the growth will continue to the area of 0.9212 and 0.9330. In the case of the breakdown of 0.8915, the quotes will probably renew the low of the last month of 0.8833.

The medium-term trend remains downward: the asset is declining from the area of the key trend resistance 0.9139–0.9109 to zone 2 (0.8839–0.8811), after reaching which a correctional model may develop. In case of a breakout of zone 2, zone 3 (0.8566–0.8540) will be the next sell target.

Support and resistance

Resistance levels: 0.9110, 0.9212, 0.9330.

Support levels: 0.8915, 0.8833, 0.8770.

Trading tips

Long positions may be opened from 0.8915 with the target at 0.9110 and stop loss around 0.8850. Implementation period: 9–12 days.

Short positions may be opened below 0.8850 with the target at 0.8770 and stop loss around 0.8890