USD/CHF: The pair is waiting for the outcome of the U.S. Federal Reserve meeting
USD/CHF is moderately strengthening in Asia-Pacific trading session, trying to develop the insignificant "bulls" dynamic from the previous week, currently holding at 0.9650.
Economists are expecting the publication in Switzerland, scheduled for today, which will give an opportunity to assess the dynamics of the country's trade turnover and index of trade balance. In addition, during the day session will be published the report of SECO (Swiss State Secretariat for Economic Affairs) with updated expectations for the developments within the country. Further, the experts note that the summit of Swiss Central Bank officials on monetary parameters will be held today, which will stop the wait-and-see attitude held for a long time and the agency will announce an increase of 0.75% to the target level of 0.5% on September 22.
- Resistance levels: 0.9700, 0.9762, 0.9807 and 0.9868.
- Support levels: 0.9650, 0.9600, 0.9550 and 0.9520.
GBP/USD: the leaders are still in the favor of the bears
The British currency is moving without any single dynamics, testing the level of 1.1430. Having updated a record low by the end of previous week the currency pair GBP/USD tries to return the lost positions, but the "bulls" are rather waiting for further stimulus, presumably one of which may be the result of the Bank of England meeting.
So, the next meeting of the agency will take place within the framework of the next Thursday, according to the results of which the index may be increased by 0.50% to the target level of 2.25%. Investors also want to see confirmation of the effectiveness of the measures taken on the previous day and to hear the officials' expectations of the consumer price correction in the medium term. Economists are concerned about rumors of a possible recession in the national economy. Members of the board of the regulator have previously allowed the risk of a recession approaching the end of the fiscal year, which will have to be overcome by 2024. The market uncertainty is further exacerbated by the position on fiscal policy chosen earlier by the head of government Liz Truss.
- Resistance levels: 1.1478, 1.1531, 1.1600, 1.1647.
- Support levels: 1.1404, 1.1349, 1.1300, 1.1200.
Oil market review
The price of "black gold" of Brent grade demonstrates a sideways trend, testing the level of 91.00. The asset is under pressure because of expectations for the U.S. Federal Reserve Board to publish the final minutes of the meeting, which may announce an interest rate increase by 0.75%. The officials of the Bank of England and the Swiss Central Bank may also tighten the monetary parameters during the week. The systemic increase in key values is aimed to curb rising inflation, but it also puts pressure on economic activity in the regions. So, analysts are already raising fears of recession in Eurozone economy that is already suffering from serious crisis in energy sector.
An additional negative factor exerting pressure on the asset quotations is a decline of industrial capacities in China on the background of its promotion of strict quarantine measures to combat the spread of Covid-19 infection. Markets are also concerned about restrictions actively applied to imported oil and oil products from Russia. Meanwhile, the U.S. and partners are holding consultations to approve upper limits for Russian oil on world markets.
- Resistance levels: 91.00, 92.47, 94.50, 96.54.
- Support levels: 88.79, 87.00, 86.00, 85.00.
EUR/USD: swings of the "American" are trendsetting the pair
The currency instrument EUR/USD is trading within the corrective dynamics at 1.0024.
The euro continues to be neutral due to the negative background on the state of the Eurozone economy. Thus, the Eurostat agency published the results of surveys, according to which analysts recorded an increase in the cost of the main commodity of the food segment - bread, which added 18% on average in August compared to the same period in 2021, having updated the historical record. Bread prices reached their peak in Hungary, where the cost increased by 60% in annual terms and by 10% over the previous month, while the lowest growth rates were in Belgium and France - 13% and 10% respectively. Inflation continues to strengthen as food and fuel prices develop an upward trend.
- Resistance levels: 1.0100 and 1.0320.
- Support levels: 0.9900, 0.9700.
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