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Sr. Technical Strategist
USD/CHF has pulled back roughly 2% from a fresh yearly high after an outside weekly reversal on the U.S. Consumer Price Index release. For USD/CHF, the Federal Reserve rate decision and the core personal consumption expenditures (PCE) data released a day later now form the main event risk, with little on the Swiss calendar to compete. The pair is pressing into a pivot zone that has defined its trade, and daily momentum has already turned. Two U.S. releases in two sessions now meet a currency pair whose yearly uptrend has lost its footing.
Michael Boutros, StoneX Media Senior Market Analyst, has more than 20 years of experience trading FX, commodities and equity indices, with nearly two decades spent on FX trade desks. He analyzes currency markets through a structured, multi-time-frame technical lens with a medium-term, event-driven focus, tracking how data releases and central bank decisions interact with chart structure.
U.S. inflation data, not a Swiss development, delivered the USD/CHF reversal from its yearly high. The pair had pressed against the upper parallel of a pitchfork drawn from the yearly lows for three consecutive weeks, and Boutros recalls that "We tried to break through that three weeks in a row" before the U.S. Consumer Price Index release produced an outside weekly reversal. The pullback has since extended roughly 2%, and daily RSI has dropped below 50 for the first time since August after an overbought reading the month before. Event risk on the Swiss side remains limited, which leaves U.S. data in charge of direction. "So certainly the momentum profile starting to shift here a little bit more in favor of the bears," Boutros adds.
The Federal Reserve rate decision, followed a day later by core personal consumption expenditures data, arrives as USD/CHF trades into a pivot zone where a 23.6% retracement of the yearly range, a 100% extension of the advance off the yearly lows and the July swing high converge. According to Boutros, "This is the region, if broken, would suggest that a more significant high is in place and the potential for a larger kickback within this yearly uptrend". Core PCE is the Federal Reserve's preferred inflation gauge, so the two releases test both the policy decision and the inflation backdrop behind it within two sessions. A tight weekly opening range sits just above the zone, and its break is the one that should set the next definitive move in USD/CHF.
--- Written by Frédéric Guétin, StoneX Media Producer
--- Expert: Michael Boutros, StoneX Media Senior Market Analyst
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