• USD/CHF gains momentum for two straight days above the 0.8850 mark on Friday.
  • The pair holds above the 50- and 100-hour Exponential Moving Averages (EMAs) with an upward slope.
  • The immediate resistance level will emerge at 0.8875; 0.8838, acts as an initial support level for the pair.

The USD/CHF pair extends its upside for the second consecutive day above the mid-0.8800s during the Asian session on Friday. Meanwhile, the US Dollar Index (DXY) surges above the 104.20 mark supported by the higher US Treasury yields and risk-off mood in the market ahead of the key event.

At the Jackson Hole Symposium, Patrick Harker, president of the Philadelphia Federal Reserve (Fed), said that the central bank’s tight monetary policy has likely been implemented to the appropriate extent. He added that while he thinks the Fed will maintain stable interest rates this year, the data would determine the Fed’s course for the next year. While Susan Collins, president of the Boston Fed, stated that it would be premature to give a clear message regarding the timing of rate decreases, further rate increases are probable. For new inspiration, market players are anticipating Fed Chairman Jerome Powell’s remarks at the Jackson Hole Symposium on Friday. Officials’ pessimistic remarks could strengthen the USD and support the USD/CHF pair.

According to the one-hour chart, USD/CHF holds above the 50- and 100-hour Exponential Moving Averages (EMAs) with an upward slope, which means the path of least resistance for the pair is to the upside. The Relative Strength Index (RSI) holds in bullish territory above 50. However, the overbought condition indicates that further consolidation cannot be ruled out before positioning for any near-term USD/CHF appreciation.

Having said that, the Bollinger Band’s upper border and the low of July 7 will intersect at 0.8875 to form the first point of resistance for the USD/CHF. The further upside filter can be found between 0.8915 (high of October 10) and 0.8970 (high of July 7), then between 0.8950 (low of July 6) and 0.8970.

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