USD/CHF Price Forecast: Returns Above 20-Day EMA After Almost A Month

• USD/CHF posts a fresh weekly high near 0.7765 amid a firm US Dollar.

• FOMC Minutes showed on Wednesday that officials are not in a rush to reduce interest rates.

• US-Iran tensions have improved the safe-haven demand of the Swiss Franc.

The USD/CHF pair is up 0.15% to near 0.7765 during the European trading session on Friday, the highest level seen in over a week. The Swiss Franc pair trades firmly as the US Dollar (USD) gains on expectations that several Federal Reserve (Fed) officials are unlikely to favor interest rate cuts in the near term.

During the press time, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades firmly near the four-week high of 98.00 posted on Thursday.

Federal Open Market Committee (FOMC) Minutes of the January policy meeting showed on Wednesday that officials see no hurry for interest rate cuts as the United States (US) inflation has remained above 2% for a longer period.

On the economic data front, investors await the preliminary US Q4 Gross Domestic Product (GDP) and the S&P Global Purchasing Managers’ Index (PMI) data for February, which will be released during North American trading hours.

Though investors have underpinned the US Dollar against the Swiss Franc (CHF), the latter trades broadly stable as the market sentiment remains slightly risk-averse due to tensions between the US and Iran.

USD/CHF technical analysis

USD/CHF trades higher at around 0.7765 at the press time. Price steadies just above the 20-day EMA at 0.7753, and the average has flattened after a multi-week decline. The moderating slope signals fading bearish pressure, though trend confirmation remains absent.

The recovery move in the 14-day Relative Strength Index (RSI) from below 30 to 49 indicates weakening of strength in the bearish momentum.

A sustained close above the 20-day EMA at 0.7753 would keep a recovery path open and could draw follow-through buying towards the February 2 high of 0.7818. Failure to hold the average would undermine the nascent base and reassert the broader downswing.