As mentioned in my earlier report
, Wednesday’s big inflation surprise means the dollar is likely to remain supported against currencies where the central bank is more dovish or less hawkish than the Fed. The USD/CHF comes to mind, with the SNB repeatedly re-iterating the franc remains overvalued.
The Swissy has held its own above the bullish trend that has been in place since January. It has also broken above last week’s high at 0.9175, in a further bullish development. The USD/CHF could accelerate to the upside on technical buying should it eventually break its long-term bearish trend line:
On the daily time frame, the shaded blue area is where we would expect to see some dip-buying around, should we see a pullback in the next day or two:
For as long as support holds in that area, the path of least resistance would remain to the upside.
Source for all charts used: ThinkMarkets and TradingView.com
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