USDCHF: Bulls Find Their Rhythm on SNB Jordan’s Comments; Reduction of Speculative USD Shorts

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According to the latest CFTC Positioning Report, speculators have reduced their net short positions on the US Dollar. Net shorts on the greenback for the week ended September 29 fell from $33.60 billion
to $30.47 billion. This positioning change by USD speculators is reflecting in the USDCHF pair, which is starting to show recovery this Tuesday
after a dismal performance the week before.

Also complementing the bullishness on the USDCHF are the latest statements by the Chairman of the Swiss National Bank (SNB), Thomas Jordan. In an interview on Tuesday with RTS, Jordan was quoted as saying that the bank’s board members were “not big bags of negative interest rates”, but that it was a necessary tool given the current risk environment. These comments triggered further weakness in the Swiss Franc, already put off by Monday’s slight risk-on flows in the market.

The USDCHF is trading higher by 0.57%, with a 52.4-point gain towards 0.91404.
Technical Outlook for USDCHF
The decline of last week negated the rounding bottom pattern on the daily chart but found support close to the 0.90809 price level. Today’s bounce has sent price towards the 0.91533 resistance. A break of this resistance opens the pathway towards 0.91899, with 0.92264 serving as the next upside target.

A rejection at the 0.91533 resistance could allow for a pullback towards the 0.90809 support. At this point, any additional selling pressure which forces a breakdown of that level could prompt a decline towards 0.90479, with 0.90629 serving as a pitstop.

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USDCHF Daily Chart

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