Swiss Franc Technical Forecast: USD/CHF Breakout Looms
USD/CHF is trading in a well-defined range just below downtrend resistance with breakout potential ahead. Battle lines drawn on the Swiss Franc weekly technical chart.
Written by
Michael Boutros
Sr. Technical Strategist
Swiss Franc Technical Forecast: USD/CHF Weekly Trade Levels
- USD/CHF rebound off support exhausts into downtrend, multi-week range in view
- USD/CHF breakout potential into June open- U.S. Core PCE, Non-Farm Payrolls on tap next week
- Resistance 8406/16 (key), 8555, 8729/57- Support 8206, 8103 (key), 7769
USD/CHF is trading just below downtrend resistance with price holding within a five-week range into the close of the month. The focus is on a potential breakout into the monthly cross with key US inflation and employment data on tap next week. Battle lines drawn on the USD/CHF weekly technical chart.
Swiss Franc Price Chart – USD/CHF Weekly
Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView
Technical Outlook: In my last Swiss Franc Technical Forecast we noted that USD/CHF had, “rebounded off downtrend support with the recovery now testing initial resistance. From a trading standpoint, a good zone to reduce portions of long-exposure / raise protective stops- losses should be limited to the weekly low IF price is heading higher on this stretch with a close above the 8416 needed to fuel the next major leg of the advance.” USD/CHF rallied more than 5.4% off the yearly lows and although price registered an intraweek high at 8476, the bulls failed to mark a weekly close above.
The subsequent pullback is rebounding this week off the 61.8% retracement of the recent recovery at 8206 and the focus is on this recovery just below confluent resistance at 8406/16- a region defined by the 2024 low-close, the 2023 low-week close (LWC) and the 2024 yearly open. Look for a break of this range for guidance in the days ahead.
A topside breach would suggest a more significant low was registered last month / a larger trend reversal is underway. Subsequent resistance objectives at the July 2023 low at 8555 and the 52-week moving average / 61.8% retracement / 2021 low at 8730/57. Broader bearish invalidation remains unchanged at the 78.6% retracement of the yearly range at 8953.
A break below the 82-handle exposes key support again at the 61.8% extension of the 2022 decline at 8103. Ultimately, a break below the 25% parallel would be needed to mark downtrend resumption / fuel the next major leg of the decline. Subsequent support objectives rest at the 2011 LWC at 7769 and the 2011 low close at 7670- both areas of interest for possible downside exhaustion / price inflection IF reached.
Bottom line: A rebound off downtrend support has exhausted into the median-line and the immediate focus is on a breakout of the 8206-8416 range for guidance. From a trading standpoint, rallies should be limited to this week’s high IF price is heading lower this stretch with a close below 8206 needed to fuel another test of the lows.
Keep in mind we get the release of key U.S. inflation data into the monthly cross with Non-Farm Payrolls on tap next week. Stay nimble into the releases and watch the weekly closes here for guidance. Review my latest Swiss Franc Short-term Outlook for a closer look at the near-term USD/CHF technical trade levels.
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--- Written by Michael Boutros, Sr Technical Strategist
Follow Michael on X @MBForex
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