Current trend

The USD/CHF pair is correcting around 0.8580 amid local positive dynamics of the American currency and a stable franc.

The position of the Swiss currency, which was quite strong at the beginning of the month, has been weakening slightly lately, and the reason for this was the labor market statistics published by the State Secretariat for Economic Affairs (SECO). According to the report, in July the number of unemployed increased by 3.198 (3.1%) to 107.716K people, and compared to the same period a year earlier, unemployment adjusted by 20.115K (23.0%), while the overall figure remained around June’s 2.3%. The largest increase was observed in the category of young people aged 15–24 (0.953K or 10.7%), contributing to the change in the percentage value by 0.2 percentage points to 2.2%. Thus, the labor market in Switzerland is still very unstable, and compared to last year, there is a significant negative trend, which significantly restrains the growth of the national economy.

The American dollar is trading at 103.00 in the USDX, up from 102.40 on Monday. Investors have adopted a wait-and-see attitude ahead of tomorrow’s publication of initial jobless claims. Analysts expect it to decline to 245.0K from 249.0K previously but in any case, it is still much higher than the average value of 220.0–230.0K at the beginning of the summer, restraining the dollar from stronger growth.

Support and resistance

On the daily chart, the trading instrument is correcting, retreating from the support line of the downward channel 0.8920–0.8670.

Technical indicators are maintaining a sell signal: fast EMA on the Alligator indicator are moving away from the signal line, and the AO histogram is forming correction bars in the sell zone.

Resistance levels: 0.8620, 0.8740.

Support levels: 0.8510, 0.8360.

Trading tips

Short positions may be opened after the price declines and consolidates below 0.8510, with the target at 0.8360. Stop loss — 0.8570. Implementation period: 7 days or more.

Long positions may be opened after the price grows and consolidates above 0.8620, with the target at 0.8740. Stop loss — around 0.8560.