Published on May 23, 2023

Daily Analysis For USD/CHF 23-05-2023

USD/CHF Analysis

Economic Events and Scenario for USD/CHF

Economic Events : -

GMT	Event	Impact	Currency
00:00	(Australia) Judo Bank Composite PMI	Low	AUD
00:00	(Australia) Judo Bank Manufacturing PMI	High	AUD
00:00	(Australia) Judo Bank Services PMI	High	AUD
01:00	(Montenegro) Independence Day	None	EUR
01:30	(Japan) Jibun Bank Manufacturing PMI	Medium	JPY
01:30	(Japan) Jibun Bank Services PMI	Medium	JPY
01:30	(Japan) Jibun Bank Composite PMI	Low	JPY
07:00	(Lithuania) Industrial Production MoM	Low	EUR
07:00	(Lithuania) Industrial Production YoY	Low	EUR
07:00	(United Kingdom) Public Sector Net Borrowing	Low	GBP
07:00	(United Kingdom) Public Sector Net Borrowing Ex Banks	Low	GBP
08:00	(Slovakia) Current Account	Low	EUR
08:15	(France) S&P Global Composite PMI	Low	EUR
08:15	(France) S&P Global Manufacturing PMI	Medium	EUR
08:15	(France) S&P Global Services PMI	Medium	EUR
08:15	(Euro Area) ECB Guindos Speech	High	EUR
08:15	(Euro Area) ECB Jochnick Speech	Low	EUR
08:30	(Germany) S&P Global Composite PMI	Low	EUR
08:30	(Germany) S&P Global Services PMI	High	EUR
08:30	(Germany) S&P Global Manufacturing PMI	High	EUR
09:00	(Euro Area) Current Account	Low	EUR
09:00	(Euro Area) S&P Global Composite PMI	Low	EUR
09:00	(Euro Area) S&P Global Services PMI	High	EUR
09:00	(Euro Area) S&P Global Manufacturing PMI	High	EUR
09:00	(Euro Area) Current Account s.a	Low	EUR
09:30	(Slovenia) Consumer Confidence	Low	EUR
09:30	(United Kingdom) S&P Global/CIPS Manufacturing PMI	High	GBP
09:30	(United Kingdom) S&P Global/CIPS UK Services PMI	High	GBP
09:30	(United Kingdom) S&P Global/CIPS Composite PMI	Low	GBP
10:00	(Italy) Current Account	Low	EUR
10:00	(United Kingdom) 28-Year Index-Linked Treasury Gilt Auction	Low	GBP
10:30	(Germany) 2-Year Schatz Auction	Low	EUR
11:00	(Latvia) PPI YoY	Low	EUR
11:00	(Latvia) PPI MoM	Low	EUR
11:25	(Euro Area) ECB Enria Speech	Low	EUR
13:00	(United States) Building Permits	Medium	USD
13:00	(United States) Building Permits MoM	Low	USD
13:30	(Canada) Raw Materials Prices YoY	Low	CAD
13:30	(Canada) Raw Materials Prices MoM	Low	CAD
13:30	(Canada) PPI YoY	Low	CAD
13:30	(Canada) PPI MoM	Low	CAD
13:55	(United States) Redbook YoY	Low	USD
14:00	(United States) Fed Logan Speech	Medium	USD
14:45	(United States) S&P Global Services PMI	High	USD
14:45	(United States) S&P Global Composite PMI	Medium	USD
14:45	(United States) S&P Global Manufacturing PMI	High	USD
15:00	(United States) Richmond Fed Manufacturing Shipments Index	Low	USD
15:00	(United States) New Home Sales MoM	High	USD
15:00	(United States) Richmond Fed Services Index	Low	USD
15:00	(United States) New Home Sales	High	USD
15:00	(United States) Richmond Fed Manufacturing Index	Low	USD
15:30	(Slovenia) Unemployment Rate	Low	EUR
18:00	(United States) 2-Year Note Auction	Low	USD
20:00	(El Salvador) Balance of Trade	Low	USD
21:30	(United States) API Crude Oil Stock Change	Medium	USD
23:45	(New Zealand) Retail Sales YoY	High	NZD
23:45	(New Zealand) Retail Sales QoQ	High	NZD

Today's Scenario: - USD/CHF is retreating to 0.8975 as bears contend with a short-term support line during the early hours of Monday's European session. Despite downbeat first-quarter (Q1) industrial production growth in Switzerland, the Swiss Franc (CHF) pair fails to find support due to the US Dollar's inability to rally on recent positive news regarding US default fears and hawkish Federal Reserve (Fed) expectations.

The Q1 industrial production data from Switzerland reveals the slowest growth since Q4 of 2021, with a year-on-year (YoY) figure of 3.4%, compared to the previous reading of 6.1%. This data supports the Swiss National Bank's (SNB) cautious approach to raising benchmark rates after providing substantial stimulus to borrowing costs.

Buy Scenario: - From a daily chart perspective, the USD/CHF has shifted from a neutral-to-downward bias to a neutral stance. In early May, the pair reached a new year-to-date low of 0.8820. Since then, USD/CHF has climbed 1.80%, showing a series of new highs and lows, but it has yet to turn the pair into a neutral-to-upward bias.

If the USD/CHF manages to reclaim the daily high from April 10 at 0.9120, it could shift the bias to neutral-upward and potentially open the door for a rally above the 100-day Exponential Moving Average (EMA) located at 0.9136. Further upside potential lies above 0.9200, with the 200-day EMA at 0.9271 acting as the key resistance level to change the pair's bias to upward. Till we do not advise to buy USD/CHF.

Sell Scenario: - On the other hand, for a bearish continuation, the USD/CHF would need to fall below the 20-day EMA at 0.8964. Breaking below this level would expose the low from May 22 at 0.8940 and potentially clear the path for the pair towards the low from June 9, 2021, at 0.8926, followed by the 0.8900 level. Till we do not advise to sell USD/CHF.

Support and Resistance Level: -