Source: PaxForex Premium Analytics Portal, Fundamental Insight
Swiss Producer & Import Prices for October increased by 0.2% monthly and decreased by 0.9% annualized. Forex traders can compare this to Swiss Producer and Import Prices for September, which contracted by 0.1% monthly and 1.0% annualized.
A speech this morning by Swiss National Bank Chairman Thomas Jordan had no impact on the Swiss Franc.
The US NFIB Small Business Optimism Index for October is predicted at 90.5. Forex traders can compare this to the NFIB Small Business Optimism Index for September, reported at 90.8.
The US CPI for October is predicted to increase by 0.1% monthly and 3.3% annualized. Forex traders can compare this to the US CPI for September, which rose by 0.4% monthly and 3.7% annualized. The US Core CPI for October is predicted to expand by 0.3% monthly and by 4.1% annualized. Forex traders can compare this to the US Core CPI for September, which rose by 0.3% monthly and by 4.3% annualized.
Speeches by US FOMC Member Williams, Federal Reserve System Governor Jefferson, Fed Vice Chair for Supervision of the Board of Governors Barr, and Federal Reserve Bank of Chicago President Goolsbee are unlikely to have a significant impact on the US Dollar, as traders will focus on the October CPI. Inflation remains sticky, and inflationary expectations rose, posing a threat to the US Federal Reserve and its fight to bring inflation down to 2.0%. Three and five-year outlooks among consumers are above 3.0% for inflation, which can become a self-fulfilling prophecy and force more interest rate increases by the US central bank against the backdrop of a slowing economy and surging debt.
The forecast for the USD/CHF is cautiously bearish after this currency pair began a gradual contraction from a multi-month peak. The Ichimoku Kinko Hyo Cloud has narrowed, and the Senkou Span A and the Senkou Span B have flatlined, with the next move likely a bearish crossover that can accelerate selling pressure. Adding to the downside momentum are the descending Kijun-sen and Tenkan-sen. Following their bearish crossover, more selling could follow. Traders should also monitor the CCI after it recorded a lower high in extreme overbought territory. A double breakdown followed, below 100 and below zero, granting bears control of price action. This technical indicator has plenty of downside potential and could lead to the expected sell-off in this currency pair. Can bears maintain control over the USD/CHF and pressure price action into its horizontal support area and a multi-month low? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the USD/CHF remain inside the or breakdown below the 0.8995 to 0.9045 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.9015
- Take Profit Zone: 0.8745 – 0.8810
- Stop Loss Level: 0.9065
Should price action for the USD/CHF breakout above 0.9045, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 0.9065
- Take Profit Zone: 0.9110 – 0.9165
- Stop Loss Level: 0.9045
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