Swiss Franc Short-term Outlook: USD/CHF Rebound Tests Broken Uptrend

Swiss Franc Technical Forecast: USD/CHF Short-term Trade Levels

• USD/CHF remains broadly constructive after extending the advance from the August low, but the recent reversal has damaged the near-term trend structure.
• The first rebound from last week’s selloff is now testing former uptrend support as resistance, putting the focus on whether buyers can reclaim the broken slope.
• A sustained break above near-term resistance would shift the focus back toward the October highs and revive the broader bullish continuation scenario.
• Failure to reclaim resistance would keep the risk tilted toward a deeper correction within the larger advance.
• Resistance 83450/58, 8375/87 (key), 8416/30- Support 8289, 8259 (key), 8200/15

USD/CHF is attempting to mark a seventh consecutive weekly advance, but the near-term technical picture has become more complicated after last week’s break of the September uptrend. The initial rebound from the selloff is now pressing former trend support as resistance, creating an important inflection point for the recovery. A successful reclaim would refocus attention on the October highs and strengthen the case for broader uptrend resumption, while another rejection would leave the pair vulnerable to a deeper correction. With the economic calendar relatively light into Friday, shifts in Treasury yields and Fed expectations may provide the next catalyst ahead of next week’s key U.S. inflation data.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this USD/CHF setup and more. Join live on Monday’s at 8:30am EST.

Swiss Franc Price Chart – USD/CHF Daily

Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView

Technical Outlook: In last month’s Swiss Franc Short-term Outlook we noted that USD/CHF had rallied into resistance at five-week highs and that, “From a trading standpoint, losses should be limited to 8069 IF price is heading higher on this stretch with a close above 8152 needed to fuel another run at the yearly highs. Look for another meaningful reaction on a test of the 82-handle for guidance IF reached.” USD/CHF briefly registered an intraday low at 8052 the following day before reversing higher with a breakout of the September opening range fueling a 4.1% rally off the monthly low.

The advance extended more than 5.4% off the August low before marking an outside day reversal off confluent resistance into the October open at 8375/87. This region is defined by the 2024 swing low and the 1.618% extension of the August rally and converges on the upper parallel of a multi-month pitchfork extending off the January / August lows. The monthly opening range has now taken shape just below and while the broader outlook remains constructive, the advance may be vulnerable while below this threshold.  

Swiss Franc Price Chart – USD/CHF 240min

Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView

Notes: A closer look at Swisse price action shows USD/CHF breaking below the lower parallel of the September uptrend last week with former support serving as resistance for the past few days. Price is now approaching initial resistance at the 78.6% retracement of the most recent decline and the objective monthly open at 8350/58. Note that the lower parallel converges on this zone tomorrow and a break / close above this slope would shift the focus back towards key resistance at 8375/87. Ultimately, the bulls will need to clear this zone to mark uptrend resumption toward the next major technical consideration at the 2024 yearly open and the 2024 low-day close (LDC) at 8416/30.

Weekly open support rests at 8289 and is backed by the 100% extension at 8259. Basic trendline support extending off the August low (red) converges on this level next week and losses below this slope would be needed to suggest a more significant high is in place and a larger correction is underway. Subsequent support rests with the 100% extension of the January advance and the 38.2% retracement of the 2025 decline at 8200/15. Look for a larger reaction there IF reached.

Bottom line: USD/CHF has broken a multi-week uptrend after reversing off key resistance into the start of the month. The risk remains for a deeper correction within the confines of the broader uptrend. From a trading standpoint, rallies should be limited to 8358 IF price is heading lower on this stretch – look for a larger reaction on a test of the August uptrend near 8259 with a breach / close above 8387 ultimately needed to fuel the next leg higher in price.

Event risk remains relatively light for USD/CHF in the days ahead, with the Michigan Consumer Sentiment Index on tap Friday. While the survey may have a limited market impact, any meaningful shift in consumer expectations could influence the dollar through Treasury yields and near-term Fed pricing. The focus then turns to next week’s key inflation data, which should provide a more significant test for the U.S. monetary-policy outlook and help shape the next directional move in USD/CHF. Stay nimble into the releases and watch the weekly close for guidance. Review my latest Swiss Franc Weekly Forecast for a closer look at the longer-term USD/CHF technical trade levels.

USD/CHF Key Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

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--- Written by Michael Boutros, Sr Technical Strategist

Follow Michael on X @MBForex