USD/CHF is showing a moderate rise, recovering from last week's decline during which the December lows were updated. The pair is currently testing the 0.8460 level for the possibility of an upward breakout, which is largely facilitated by John Murphy's technical analysis factors supporting the dollar's growth.
Investors continue to analyze the August data on the American labor market, which came out worse than expected. The number of jobs outside agriculture amounted to 142 thousand, with a forecast of 160 thousand. Additionally, the downward revision of the July data — from 114 thousand to 89 thousand — caused significant volatility in the Friday session. At the same time, the average hourly wage increased from 0.2% to 0.4% on a monthly basis and from 3.6% to 3.8% on an annual basis. Against the background of these data, expectations for a Fed rate cut in September remained at the same level: the probability of an adjustment by 50 basis points is estimated at about 35%.
In Switzerland, as predicted, the unemployment rate remained at 2.5% in August. Experts expect that the Swiss National Bank, given the continued weakening of inflation, will also lower interest rates at its meeting on September 26. The August consumer price index in Switzerland slowed from 1.3% to 1.1%, which is slightly better than forecasts of 1.2%.
The indicators show ambiguous signals on the daily chart. The Bollinger bands begin to turn sideways, the MACD shows a weak buy signal, and the Stochastic stopped falling and leveled off near the 20 mark.
We will consider buying after an upward breakout of the 0.8500 level. The nearest target is 0.8600. We will set the stop loss at 0.8450.
If the price bounces off the 0.8500 resistance and breaks down the 0.8450 level, this will be a signal to start selling with a target of 0.8365. We will place the stop loss at the level of 0.8500.