- Summary:
- USDCHF pair rose for the fourth straight day as traders continued to focus on the stronger US dollar. They are also reacting to weak Swiss unemployment data
The USDCHF is up for the fourth straight day as the strength of the US dollar remains. The pair is trading at 0.9185, which is a few pips below the yesterday’s high of 0.9200.
Switzerland unemployment rate remains low
The employment situation in Switzerland remained a bit resilient as the country continued to reopen after the previous coronavirus lockdowns. According to the State Secretariat for Economic Affairs (SECO), the country’s unemployment rate rose to 3.3% from the previous 3.2%. This happened as the number of people who registered with the regional employment centres rose by 2,241 to 151,111.
The bureau said that youth unemployment increased by 2,446 people while the number of unemployed people between 50 and 64 years increased by just 305 people.
While the unemployment rate rose in August, it remains significantly better than that of comparable companies. For example, in the United States, the unemployment ratedropped to 8.4% while in the European Union, the rate has jumped to above 7%. In the UK, the rate is at 3.9%.
The stability of the Swiss employment scene is probably because the government has increased its monetary support for the country’s companies. The Swiss National Bank (SNB) has also lowered interest rates to historic lows, which has reduced the cost of borrowing for companies and individuals.
Meanwhile, the USDCHF pair is also rising because of the overall strong US dollar. The greenback has strengthened because of the relatively strong data from the US. For example, the economy has added more than 10 million jobs in the past three months while manufacturing and services industries have continued to add jobs.
USDCHF technical outlook
The USDCHF pair is trading at 0.9185, a week after it formed a bullish engulfing pattern at about 0.9000. The price has managed to move above the 25-day exponential moving averages and bulls are now attempting to move above the 50-day EMA. Most importantly, the pair has managed to move above the resistance line of the descending channel that is shown in green.
This is an indication that bulls have prevailed, which means that the pair is likely to continue rising. If it does, the next target to watch will be 0.9200. On the flip side, a move back to the channel at 0.9100 will invalidate this trend.
USDCHF technical outlook
