Should We Be Wary of the Swiss Franc’s Downward Potential Following the Decline in the CPI?

Should We Be Wary of the Swiss Franc’s Downward Potential Following Its Decline Due to Lower CPI?

05.07.2024

In the U.S. currency market the previous day, with U.S. markets closed for a holiday, the U.S. dollar became the weakest currency during U.S. trading hours. The USD/JPY pair fell from 161.673 to 160.941, dropping below the 20-period moving average (MA) on the hourly chart.On the 4-hour chart, the 20-period moving average is acting as resistance, and on the daily chart, the price has fallen from the +2σ level of the Bollinger Bands to just below the 10-period moving average.

European currencies saw the Swiss franc weaken against the yen after yesterday’s release of Switzerland’s June Consumer Price Index (CPI), which fell 0.1 percentage points year-over-year from the previous month’s 1.4% to 1.3%. The CHF/JPY pair fell from 179.424 to 178.548.It fell to the 200-period EMA on the hourly chart. On the 4-hour chart, the upper price range is gradually narrowing, and on the daily chart, the RSI has begun to pull back from 84.

Today, the Philippine Consumer Price Index will be released at 10:00, followed by Singapore’s retail sales and Japan’s Economic Sentiment Index at 14:00, and Germany’sIndustrial Production, at 15:45 Germany’s Industrial Production, at 16:00 remarks by Nagel, President of the German Federal Bank, at 18:00 Eurozone Retail Sales, at 18:40 remarks by Williams,Remarks by Williams, President of the New York Fed; at 21:30, Canada’s Employment Report and U.S. Employment Report; at 23:00, Canada’s Ivey Purchasing Managers’ Index; and at 26:15, remarks by Lagarde, President of the ECB. Keep an eye on the Swiss franc’s potential to rebound after its decline due to the drop in the CPI.