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USD/CHF loses ground following soft JOLTS from the US and CPI data from Switzerland

  • USD/CHF faced turbulence in Tuesday’s session, dipping further towards 0.8890.
  • CPI data from Switzerland came in steady.
  • The likelihood of rate cuts in September by the Fed remains bound to the outcome of labor market data to be reported this week.

The USD/CHF pair is trending lower following recent JOLTS data released on Tuesday which showed a lower number of job openings than initially predicted from the US. Markets also are digesting inflation data from Switzerland.

The number of job openings in the US on the last business day of April was reported to be 8.059 million, a figure below the market's expectation of 8.34 million. This follows the unexpected March figures, which were revised to 8.35 million from 8.48 million. Despite this, the market maintains hope for the first-rate cut to occur in September, but those odds may change as investors are expecting a fresh Nonfarm Payroll report from May, due on Friday. ADP data and Jobless Claims on Wednesday and Thursday will also be looked at.

In Switzerland, inflation steadied as forecasted at 1.4% YoY for May while the core inflation was slightly lower than expected, at 1.2% YoY. On the Swiss National Bank (SNB), the bank had previously commenced its easing cycle in March, with a 25 bps cut to 1.5%. The market is currently pricing in about 55% odds for another rate cut at the next meeting on June 20.

USD/CHF technical analysis

On the technical front, indicators have plunged deep into negative territory with the daily RSI already signaling oversold conditions. This is followed by the Moving Average Convergence Divergence (MACD) which prints red bars. This may suggest that an upward correction could be imminent. However, the pair has now lost its position above both the 20-day SMA at 0.9095 and the 100-day SMA, pointing towards a more bearish short-term outlook. The 200-day SMA offers additional support to prevent losses.

USD/CHF daily chart

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