Market sentiment changed to a cautious approach to the threat of an attack on a Saudi Aramco oil plant in Jeddah.
USD/CHF Forecast: While the USD/CHF pair has an upward bias per the daily chart the pair is bearish in near term as indicated by the 1-hour chart.
After four days of losses, the USD/CHF recovered and rose from the lows of the day, at 0.9260. This was despite mixed market sentiment and expectations for 50-bps rate increases by the US central banks during its May monetary policy meeting. The USD/CHF trades at 0.9304 as of the writing.
The US equity indices are under pressure due to a risk-off mood, while European bourses fluctuate. The greenback is now at 98.819 and has erased earlier losses. However, US Treasury yields have soared with the 10-year up 14 basis point at 2.489% but still below daily highs of 2.503%.
Market mood was slowed by reports that a Saudi Aramco crude oil facility in Jeddah (Saudi Arabia) was struck by a missile fired by the rebel Houthi militia. Social media reports suggested this.
Overnight, the USD/CHF dropped from 0.9300ish towards 0.9260, the top of an eleven-month-old downslope trendline, previous resistance-turned-support, and jumped off as the North American session evolves, amid a softer demand for the greenback.
USD/CHF Forecast: Technical outlook
The USD/CHF daily chart shows the pair as being upward biased despite it breaking below the 0.9373 mark. However, resistance would come ahead of the YTD high at 0.9460.
The USD/CHF is bearishly biased in the short term, according to the 1-hour chart. The USD/CHF is testing a downslope trendline from the March 16 highs. This trendline was unsuccessfully tested twice before. The USD/CHF’s first support level at 0.9300 would be achieved if the trendline holds. Brute of this trendline would result in Friday’s daily low of 0.9260 and March 9 lows at 0.9250.
