USD/CHF is expected to trade in a higher range. It is undermined by the softer USD sentiment (ICE spot dollar index last 88.15 versus 88.41 early Monday) after lower Markit flash U.S. November services PMI of 56.3 versus final October reading of 57.1, drop in Chicago Fed National Activity Index to +0.14 in October from +0.29 in September, spillover strength from euro on the Swiss franc and franc demand on buoyant CHF/JPY cross. But USD/CHF losses are tempered by the ultra-loose Swiss National Bank’s monetary policy.
Daily chart is mixed as stochastics is in bullish mode, but MACD is bearish.
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 0.9720 and the second target at 0.9740. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.9605. A break of this target would push the pair further downwards and one may expect the second target at 0.9555. The pivot point is at 0.9655.
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