As the USD/CHF pair dipped to a low of 0.8375 before bouncing back above 0.8400, investors are closely watching the impact of the recent US labor market data. The US Dollar saw a decline in demand following the release of lower-than-expected NFP figures for August, with only 142,000 new jobs created compared to the forecast of 160,000. Despite this, the Unemployment Rate dropped to 4.2% as Average Hourly Earnings rose by 3.8% year-over-year.
Investors are now speculating on the possibility of a larger rate cut by the Federal Reserve in September, with a 40% chance of a 0.50% cut. However, a 25 bps cut is already expected to kick off the easing cycle next month, pending further data analysis.
Technical Analysis: USD/CHF Outlook
From a technical standpoint, the USD/CHF pair’s outlook remains neutral to bearish. The RSI indicates negative territory with a flat slope, while the MACD shows flat green bars, supporting a neutral stance. The pair is currently trading below its 20, 100, and 200-day SMAs, suggesting a downward bias in the near term.