The USD/CHF pair saw a boost in buying on Wednesday, pulling away from the weekly low around 0.8060 that was recorded the previous day. During early European trading, the price climbed to a daily peak, with bulls aiming to push above the 0.8100 threshold.
As market participants reacted to the weak US Consumer Price Index (CPI) data released Tuesday, concerns about inflation driven by energy resurfaced. This comes amid rising tensions between the US and Iran and the ongoing closure of the Strait of Hormuz, which continue to support oil prices. Such factors heighten expectations for a potential interest rate increase by the US Federal Reserve, lending some strength to the US dollar (USD). This, in turn, has provided a favorable backdrop for the USD/CHF pair and bolstered a positive short-term outlook.
From a technical standpoint, the pair’s breakout above the 200-day simple moving average (SMA) and strength beyond the psychological level of 0.8000 have served as critical catalysts for bullish investors. Additionally, the Relative Strength Index remains in a positive zone around 58, indicating no signs of being overbought, thus suggesting strong underlying demand.
On the flip side, the Moving Average Convergence Divergence (MACD) is somewhat concerning, as it’s just beneath the zero line and showing a slight negative value. This hints that upward momentum isn’t convincingly strong, despite the supportive price action. Nevertheless, as long as the USD/CHF pair stays above that key SMA, the broader trend is likely to continue upwards, with any pullback towards 0.8000 viewed as a potential buying opportunity for bullish traders.
If the price does drop further, the 200-day SMA located around 0.7919 could act as a significant lower boundary, and a decisive breakout below this level would likely shift sentiment towards bearish traders. Conversely, if the market surpasses the 0.8145-0.8150 range hit on Tuesday, which is the highest point since July 2025, it would likely signal an extension of the recent upward movement that began from the 0.7760 region, or the lows of May.
