USD/CHF pushed higher on Friday even as the US Dollar eased, with monetary policy expectations between the Federal Reserve and the Swiss National Bank still diverging. The pair traded around 0.8080, its highest level since November 2025. The US Dollar Index stood near 100.80 after earlier touching 101.13, the strongest reading since May 2025. Earlier in the week both central banks kept rates unchanged, and the Fed maintained focus on returning inflation to its 2% target, while the dot plot showed nearly half of FOMC members still see at least one rate rise this year.
In Switzerland, subdued inflation has supported a steady policy stance. Technical conditions remained supportive: USD/CHF stayed above the 100-day and 200-day SMAs at 0.7849 and 0.7907, while the RSI was 68.6 and the ADX hovered near 27. Resistance sat around 0.8100, and a daily close above could shift attention to 0.8300 and then 0.8500. Support was identified at the 200-day SMA near 0.7907, with the 100-day SMA at 0.7849 as the next layer. The report said the technical analysis was produced with help from an AI tool.
Monetary Policy Divergence Supports Bullish Outlook
Based on the diverging monetary policies, we see the US Dollar continuing to strengthen against the Swiss Franc. The Federal Reserve is signaling potential rate hikes to manage inflation, while the Swiss National Bank seems content with its current stance. This fundamental difference is the primary driver for our bullish outlook on the USD/CHF pair.
Our view is reinforced by the latest inflation figures from this month. US Consumer Price Index data for May 2026 came in at 3.6%, slightly above expectations and keeping pressure on the Federal Reserve. In contrast, Swiss inflation remains subdued at just 1.4%, giving the Swiss National Bank no reason to change its course.
Trading Strategies and Risk Considerations
For the coming weeks, we are looking at buying USD/CHF call options to capitalize on the expected upward movement. The initial resistance at 0.8100 is a clear short-term target, and a move above that could open the way towards 0.8300. We find call options with July and August 2026 expiration dates to be the most suitable plays.
An alternative strategy is selling out-of-the-money put options to collect premium. We see strong technical support around the 200-day moving average near 0.7900, making it a good level for a strike price. This trade profits as long as the pair avoids a significant downturn below this well-established floor.
We must remain aware that the Relative Strength Index is high, which could invite a short-term pullback. Historically, similar setups have often led to consolidation before the next move higher, as seen during the sustained climb from the lows of late 2024. Therefore, any dip towards the 0.7900 support zone should be viewed as a potential buying opportunity.
