The USD/CHF remains steady as tensions between the US and Iran contribute to a cautious market atmosphere. US PMIs exceeded expectations, reaching multi-month peaks. From a technical standpoint, USD/CHF continues to trade below significant SMAs, maintaining a bearish outlook. The USD/CHF pair remains steady on Yesterday, exhibiting erratic price movements and fluctuations as market participants hold back from making bold directional trades due to the prevailing cautious sentiment influenced by the ongoing tensions between the US and Iran. Currently, the pair is positioned at approximately 0.7845.
Market participants are paying close attention to the evolving dynamics of the US-Iran situation to evaluate the potential for a resumption of negotiations, particularly as tensions rise in the Strait of Hormuz. This is bolstering the US Dollar, even in light of some intraday weakness. The US Dollar Index, which measures the Greenback’s value against a basket of six major currencies, is currently positioned at approximately 98.67 following an intraday peak of 98.80. US President Donald Trump stated on Truth Social that “we have total control over the Strait of Hormuz, no ship can enter or leave without the approval of the United States Navy.” He further stated that he has instructed the Navy to “shoot and kill any boat” laying mines in Hormuz, emphasizing that the route is “sealed up tight” until Iran can reach an agreement.
Meanwhile, market participants are analyzing mixed US economic data. The preliminary S&P Global Manufacturing PMI increased to 54 in April, surpassing expectations and rising from 52.3 in March, reaching a 47-month high. The Services PMI has shown an improvement, rising to 51.3, surpassing forecasts of 50 and increasing from 49.8, marking a two-month high, with both figures exceeding expectations. US Initial Jobless Claims increased to 214K for the week ending April 18, surpassing the forecast of 212K and rising from the prior figure of 208K. In the daily chart, USD/CHF maintains a bearish near-term outlook as the price remains below both the 100-day simple moving average at approximately 0.7865 and the 200-day SMA around 0.7937. The pair’s failure to regain these medium- and long-term averages suggests that the recent rebounds are merely corrective movements within a larger bearish framework.
Meanwhile, the Relative Strength Index has bounced back from lows beneath 40 but continues to sit below the midline, suggesting that momentum is still skewed to the downside. The Average Directional Index is around 26, indicating a moderately directional trend. On the topside, initial resistance is positioned at the 100-day SMA at 0.7865. A break above this level would reveal a more substantial barrier at the 200-day SMA near 0.7937, where sellers are expected to reassert control upon the first test. Until price establishes a sustained move above these moving averages, rallies are likely to be sold into, which leaves the pair susceptible to additional downside exploration toward previous lows.