The currency pair is currently supported at 0.7800, yet it continues to face resistance beneath the 0.7830 level. The possibility of a resolution in the Middle East conflict is influencing the recovery of the US Dollar. The pair is presently undergoing a downward adjustment after the upward movement noted from February to April. The US Dollar is currently exhibiting minimal movement against the Swiss Franc on Thursday, with the pair maintaining a position above the 0.7800 level for the time being. However, upward movements are limited below Monday’s high at 0.7830, as expectations regarding a resolution to the Middle East Conflict are affecting the safe-haven appeal of the Greenback.
The market sentiment received a boost on Wednesday as US President Donald Trump mentioned that discussions between the US and Iran are “productive and ongoing,” suggesting that a new phase of talks is anticipated to begin soon. Furthermore, Trump suggested that Israel and Lebanon are preparing to hold direct talks focused on reaching a peace agreement, which would lay the groundwork for a stable resolution to the Middle East conflict. However, the information has yet to be verified by Lebanese officials.
The daily chart of the USD/CHF shows that the pair is currently experiencing a bearish correction, following a 5-wave Elliot Wave bullish cycle. Technical indicators still show a negative outlook, although there seems to be a minor decrease in bearish momentum. The Relative Strength Index indicates a bearish inclination, while the Moving Average Convergence Divergence histogram persists in negative territory, suggesting that downside pressure continues to prevail despite the recent halt.
Elliot Wave cycles often result in A-B-C corrections, and the decrease in bearish pressure suggests that the pair may be ready for a pullback to the previous support zone, which has now turned into resistance, between the lows of April 8 and 10 in the 0.7855-0.7875 range, or possibly to the high of April 13, at 0.7834. If the price dips below Tuesday’s low of 0.7790, keep an eye on the next levels, which are the March 10 low at 0.7748 and the February 27 low, approximately 0.7670.