USD/CHF has managed to increase after registering a sharp drop. Still, the current rebound could be only a temporary one as the DXY has bounced back.
Forex trading market participants have found the pair facing strong resistance and now it could slip lower if the US Dollar Index resumes its decline.
The US Non-Farm Payroll numbers were reported better than expected, at 850K versus 725K forecast, but it has failed to keep the US higher.
The greenback was punished by the US Unemployment Rate, which has increased from 5.8% to 5.9%, when the economists and forecasters had been expecting to see a drop to 5.6%.
Explaining the US employment puzzle
The Trade Balance was reported at -71.2B versus -71.4B expected, while the Factory Orders have increased by 1.7%, matching expectations.
The US economy is improving but the growth in employment alongside the rise in unemployment may at first sight, seem like a puzzle but is at least partly explained by how people are defined as being actively looking for work.
Also, a number of employers and politician think overly generous unemployment assistance is keeping some from rejoining the labour force.
USDCHF forecast – technical analysis: escaping the falling wedge
In today’s USDCHF forecast we note that the pair failed to stabilize above the 61.8% retracement level and beyond the minor uptrend line signalling high selling pressure. It has rebounded and it could retest the upside obstacles before deciding direction.
Dropping and closing below 0.9223 today’s low could certainly announce a larger fall to come. USD/CHF has increased after escaping from the minor Falling Wedge pattern, but now the upwards movement seems complete, for now.
The 50% retracement level and the weekly pivot point (0.9182) could be used as downside targets. Failing to reach the weekly R1 (0.9276) may bring the pair down towards the weekly pivot point.
It could be that a temporary decline could help the pair to catch a new upside movement, and bring with it a long opportunity.
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