After a sharp decline over two days, USDCHF hit its lowest point since 2011, dropping below the April low of 0.80388 to 0.8034. This drop was driven by dovish comments from Fed Chair Powell regarding a possible rate cut in July and falling yields, leading to a weaker dollar and a failed test of key support levels. When trading held above the April low of 0.80388 today, buyers began to step in. As prices bounced above the June 13 low of 0.8054, short-term momentum shifted upwards, giving buyers more confidence. If prices surpass certain targets, their position could get even stronger.

Future Targets

Future targets include 0.8088, the 100-hour moving average at 0.8130, and the 200-hour moving average at 0.81377. These resistance levels may present challenges for buyers trying to change the market trend in their favor. Key technical levels are as follows: – Support at 0.8054 – Then at 0.80388 – Followed by 0.8034 – Resistance at 0.8088 – Additional resistance at 0.8130 and 0.81377 The recent drop to new lows shook up overall sentiment, particularly as it reached levels not seen in over a decade. Powell’s gentle suggestion of easier policy options for July resonated with the markets. Yields followed suit, and the dollar weakened in response. The breach of spring’s support hinted at deeper issues, yet the lack of follow-up activity was telling. Traders jumped in to capitalize, some closing short positions while others sought value, helping prices recover short-term. The brief rise above 0.8054—a significant pivot point—was important both technically and psychologically. It suggested that immediate downside was halted, at least for now. This minor recovery shifted the mood, drawing focus back to interim resistance levels.

Watching Resistance Tests

Now, as the pair approaches 0.8088, we should be aware of potential congestion around the 100- and 200-hour moving averages. These levels have limited price movements in earlier sessions, and it’s likely that the market will continue to respect them. Any rise toward 0.8130 or 0.81377 would signify more than a mere retracement; it would indicate intent. However, we are still observing tension in the structure. If prices slip below 0.8054, it could quickly reopen the path to this week’s support areas. A break below 0.80388, followed by 0.8034, would signal that sellers are still active. In that case, we might see renewed defensive positioning in options and futures, possibly leading to more aggressive short selling. We’re paying close attention to how trading volume behaves during the next resistance test. If the bounce continues and clears 0.8088, there’s a good chance we’ll see more sustained upward attempts. But each resistance level acts like a gate, needing to be unlocked, not just assumed. With increased volatility, careful adjustments are crucial rather than bold assumptions. Expect two-sided movements as macro uncertainties linger. The strength of this rebound will depend more on market positioning early next week than on weekend news. Traders should closely monitor these key zones, viewing them not just as prices but as critical decision points. The failed breakdown gives a framework, but it’s not a guarantee. Timing is essential now. We recommend measuring trades by levels rather than momentum, making incremental adjustments instead of reacting too quickly. The market has shown one clue — it doesn’t seem ready to explore all-time lows just yet. The direction we take next week will depend on how prices perform above 0.8088 and whether traders hesitate or push toward 0.8130. Either way, the path ahead is clear. What matters now is how the market chooses to navigate it. Create your live VT Markets account and start trading now.

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