USD/CHF Recovery Gains Momentum on Robust US Growth Data

٢ سبتمبر

The USD/CHF pair continued its recovery on Monday, trading around the 0.8517 level. This uptick in the pair is largely driven by a stronger US Dollar (USD), which gained momentum following stronger-than-expected US economic growth data.

The recent Gross Domestic Product (GDP) report revealed that the US economy expanded more rapidly than anticipated in the second quarter, reducing market expectations for a larger 50 basis points (bps) rate cut by the Federal Reserve (Fed) in September. According to the second estimate released by the Bureau of Economic Analysis (BEA) last Thursday, the US GDP grew at an annualized rate of 3.0% in Q2, up from the initial estimate of 2.8%. Additionally, US Initial Jobless Claims fell to 231,000 for the week ending August 24, slightly below the projected 232,000, further supporting the Greenback.

From a technical perspective, the USD saw a significant rebound after touching our identified Demand area, where the price swiftly reversed direction. This area has proven to be a strong support level, reinforcing the bullish momentum. Moreover, the latest Commitment of Traders (COT) report highlights a marked bearish sentiment among retail traders, which, when combined with the Demand area, signals a potential continuation of the long setup.

In summary, the combination of robust US economic data, a resilient Demand area, and the bearish positioning of retail traders suggests that the USD/CHF pair may continue its upward trajectory in the near term. Traders should keep an eye on this setup as it could present further opportunities for long positions.

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