Traders are active in a swing range between 0.7910 and 0.79209. As the US session begins, prices are testing the swing low from Friday at 0.79556.

SNB’s Take on Interest Rates

The USDCHF dropped sharply due to a falling US dollar and comments from SNB’s Schlegel. He stated that negative interest rates would only return in rare situations, as they negatively affect savers and pension funds. With the policy rate at zero after this year’s cuts, Schlegel expressed caution about further easing. However, he pointed out that markets expect rates to remain steady until 2026, even as they monitor US tariffs and sluggish inflation domestically. Today, sellers continued from a closing level of 0.79317, but support was found as prices hit a low of 0.79148 within the swing area. After bouncing back, prices moved up to the Friday swing low at 0.79556, which serves as a resistance level. If this resistance holds and prices drop below the swing area of 0.7938 to 0.7947, further declines could happen. Conversely, if prices break above the Friday low, the next target could be 0.7975, followed by a swing area between 0.7986 and 0.7994.

Technical Analysis of USDCHF

Right now, we are focused on a crucial test of resistance at the 0.79556 level for USDCHF. After bouncing from strong support between 0.7910 and 0.79209, sellers may try to enter at this resistance level. For traders dealing with derivatives, it’s a clear point to make decisions in the next few weeks. The underlying weakness of the pair is strongly supported by the Swiss National Bank’s firm stance against further rate cuts. Earlier this year, they discussed the negative effects of negative rates, contrasting with the Federal Reserve’s easing cycle that started in early 2025. This difference in policy has mainly driven the strength of the franc this year. Recent data from last week reinforces this perspective, showing Swiss inflation for August 2025 holding steady at 1.7% year-over-year. This gives the SNB little reason to consider easing, keeping the franc well-supported. Meanwhile, the US jobs report from September 5th revealed a disappointing addition of only 155,000 jobs, affecting the dollar negatively. Given this context, buying put options with strike prices below 0.7900 for expiration in the upcoming weeks seems promising. A confirmed failure at the 0.79556 resistance and a drop below 0.7938 would trigger this strategy. This approach allows for a defined-risk way to profit from a potential continuation of the downtrend. However, if buyers manage to push prices above 0.79556, the immediate bearish outlook would no longer hold. In that case, focus would shift to upside targets around 0.7975. Traders might then consider short-term call options to benefit from a possible rise toward the swing area near 0.7990. Create your live VT Markets account and start trading now.

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