In today's review of USD/CHF, another major currency pair, we will conduct a detailed technical analysis of the two most senior timeframes. The situation is especially suitable, since the market closed both April and weekly trades last Friday.
Monthly
So, let's start with the highest timeframe, where a huge bullish candle appeared at the end of trading in April. We have to admit that following the Japanese yen, the Swiss franc has completely lost its status as a defensive asset, handing it over to the US dollar. In a very powerful rally, a number of important technical and psychological levels were broken, as well as the blue 50 simple moving average and the black 89 exponential moving average. To indicate the strength and scope of the upward trend, it should be noted that April trading opened at 0.9223 and ended at 0.9730. This is a tremendous move for this currency pair in terms of size. It is also worth noting that last month's highs for USD/CHF were near the strong technical level of 0.9750. The April highs were seen at 0.9757. As can be seen, USD/CHF bulls are not going to take a breather yet. They started May trading with continued rally. Right now, the pair is trading near 0.9743 and looks like it is about to hit last month's highs. Taking into account such a strong April growth, some correction to such an impressive rise is needed, after which the pair is likely to continue to hit new highs. At the moment, trading is within the monthly Ichimoku Cloud, an exit from which would reinforce the already substantial bullish sentiment and target another major technical and historical level of 0.9900.
Weekly
Last trading week was the fourth week in a row when the USD/CHF pair posted gains. Each subsequent week's increase has been more and more significant, which undoubtedly indicates an increasing bullish sentiment for this trading instrument. As noted above, right now USD/CHF is approaching the highs of the last April week, which were shown at 0.9757. It is easy to assume that a very probable breakout of this level will give the bulls in USD/CHF more energy and the rally will intensify. However, taking a bit aside from the technical aspect, this Wednesday the Fed will announce its interest rate decision, which will be followed by the press-conference, held by Fed President Jerome Powell. Of course, these events will have the most immediate and strongest impact on the dynamics of the US currency. However, since market expectations, in my personal opinion, are too high, there could be surprises.Due to this situation, it is much safer and wiser to wait for the Fed's rate decision, Jerome Powell's speech and, most importantly, the market's reaction to these crucial events. If investors remain satisfied with the Fed decision and the rhetoric of its governor, the dollar will continue to strengthen against all of its major competitors, including the pairing with the Swiss franc. Otherwise, the US dollar could have problems with its further rise. Technically, of course, buying USD/CHF looks the priority, which I recommend considering after a true breakout of 0.9757 resistance, on a pullback to this level. This trading idea should be considered after the breakout of 0.9757 on the lower timeframes.