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How long can 0.8066 hold? USD/CHF backtest and further advance
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Hello everyone, today XM Forex will bring you "[XM Foreign Exchange Decision Analysis]: How long can 0.8066 be held? Backtesting and further upward attack of USD/CHF". Hope this helps you! The original content is as follows:
During the North American session on Tuesday (November 4), the US dollar against the Swiss franc was trading around 0.8080, once touching the psychological mark of 0.8100 during the session, and repeatedly trading in the range of 0.8070-0.8100. www.xmserving.combining the latest policy statements and market characteristics, the exchange rate is in the stage of "strong shock supported by fundamentals".
Fundamental analysis: Macro interest rate differentials and risk aversion trade-offs, the US dollar dominates and the Swiss franc is under pressure
The US dollar has performed steadily recently, and the core logic lies in the Federal Reserve's "hawkish easing". Although a 25 basis point interest rate cut was implemented last week, follow-up www.xmserving.communications emphasized that "it is not certain whether easing will continue during the year," leading the market to revise down its bets on further interest rate cuts in December, and the nominal and real interest rate differentials once again added to the dollar. There are differences in the views of many officials: some officials believe that the current interest rate is "mildly restrictive" and is suitable for inflation that is still sticky above the 2% target; some regional Fed leaders have suggested that they should keep an "open attitude" in December; at the same time, some officials call the inflation data "worrying" and point out that while nominal interest rates are being lowered, financial conditions are "passively tightening" due to changes in other factors. This kind of "hawkish while lowering" framework allows the US dollar to gain bids under the resonance of interest rate differentials and uncertainty about policy paths. In terms of risk appetite, external uncertainties have heated up this week, major equity markets have fallen back, growth and thematic sectors have cooled down, the market's tolerance for high valuations has decreased, and funds are more willing to return to US dollar liquid assets and short-duration instruments. On an index basis, the U.S. dollar index broke through 100.00 and hit its highest level since early August, with an increase of nearly 0.20% on the day, pushing the U.S. dollar to remain strong against the Swiss franc.
The Swiss franc is driven more directly by inflation and policy forecasts.The margins of the period are loosening. The latest announcement of weaker-than-expected inflation has triggered the market's imagination that the Swiss National Bank may discuss a "more easing toolbox". Although this does not mean that a short-term shift is inevitable, it will help to lower the neutral interest rate and the actual interest rate differential, weakening the relative attractiveness of the Swiss franc. Subsequently, the SNB officials generally spoke on the side of stability: members of the Governing Council stated that the current interest rate is "where it should be" and will only consider unconventional means when necessary, while retaining the possibility of foreign exchange market intervention; the president judged that inflation may pick up slightly in the next few quarters, but overall it is still controllable. Taken together, the safe-haven attribute of the Swiss franc has been overshadowed by the logic of interest rate differentials in the context of "low inflation + loose expectations" and has been under periodic pressure. As a result, the US dollar against the Swiss franc has maintained an upward rhythm and repeatedly tested the key upper level.
Technical aspect:
The 30-minute K-line shows that the exchange rate has built a clear "box" between 0.8070 and 0.8100, which is marked by the purple area in the picture. The upper edge of 0.8100 is an integer psychological mark and is accompanied by multiple upper shadow line tests. It has the dual attributes of "resistance line + emotional mark"; there is a reference price of 0.8082 that approximates the central axis inside the box, which has repeatedly served as a short-term "support to resistance" switching point, and has strong price magnetism.
At the indicator level, the DIFF and DEA of MACD (26, 12, 9) are both 0.0002, and the MACD histogram is 0.0000. The three almost coincide with the zero axis, indicating that the short-term kinetic energy is in a "compressed-to-be-released" state, and the price goes sideways instead of the trend extension; once the price breaks through the box, the upward/downward movement will trigger a rapid tilt in kinetic energy. The relative strength index RSI (14) is 50.0507, indicating that the short-term is neither overbought nor oversold. The market is gaining momentum in the equilibrium zone, and the www.xmserving.competition between the upper edge of the range and the central axis will determine the direction of the subsequent round.
On the level, 0.8098 is the "previous high retracement level" in the upward process, and above it is the strong resistance of 0.8100; in terms of support, first look at the central axis of the box and the intraday dynamic support line of 0.8080, below which is the lower edge of the box at 0.8066; if it unexpectedly falls below, the historical parting low of 0.8035 can be regarded as static support further below.
The above content is all about "[XM Foreign Exchange Decision Analysis]: How long can 0.8066 hold? Backtesting and further upward attack of USD/CHF". It is carefully www.xmserving.compiled and edited by the editor of XM Foreign Exchange. I hope it will be helpful to your trading! Thanks for the support!
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