USD/CHF analysis on May 29, 2024
USD/CHF continues the weak downward movement that began last week, when the asset retreated from local highs for May 2. The pair is currently testing the 0.9125 support for a downside breakout. At the same time, trading activity in the market remains low, as traders are waiting for new drivers to appear.
Today, the US will publish data on the retail sales index from Redbook for the week ended May 24, as well as the index of business activity in the manufacturing sector of the Federal Reserve of Richmond, which may rise from -7.0 to -2.0 p. In addition, at 20:00 (GMT+2), the monthly economic review from the US Federal Reserve, known as The Beige Book. On Thursday at 14:30 (GMT+2), GDP data for the first quarter is expected, which, according to forecasts, will show a decrease in the annual rate from 1.6% to 1.3%, which may affect the course of the Fed's monetary policy. On Friday, investors' attention will be focused on the April statistics on the price index of personal consumption expenditures, where the base indicator is expected to remain unchanged at 0.3% on a monthly basis and 2.8% on an annual basis. Neil Kashkari, President of the Federal Reserve Bank of Minneapolis, said that the Fed should wait for more significant progress in reducing inflation before starting a cycle of monetary expansion. He also noted that if inflation accelerates, the Fed may return to tougher rhetoric.
Today at 10:00 (GMT+2) in Switzerland, the May statistics on the index of economic expectations from the Center for European Economic Research (ZEW) will be published. The previous indicator was revised from 11.5 to 17.6 points. On Thursday, investors will follow the speech of the head of the Swiss National Bank and GDP data for the first quarter, which are projected to remain at the same level (0.3% quarterly and 0.6% annual), which may support the Swiss franc.
The main forex indicators on the daily chart do not give unambiguous signals. Bollinger bands are trying to turn into a horizontal plane. The MACD is declining, signaling sales. Stochastic, having bounced off the maximum values, is steadily moving down.
![USD/CHF chart](/articles_files/files/usdchf_daily.png)
Long positions can be opened after a confident breakout of the 0.9130 level. The nearest target is 0.9175. We will set the stop loss at 0.9100.
A rebound from the 0.9130 level and a subsequent breakdown of the 0.9100 mark down may be a signal to form short positions with a target of 0.9037. We place the stop loss at 0.9130.