The volatility in the CHF to USD rate has declined this week, after USD/CHF climbed above 0.92 last week but tumbled to 0.90 after the FOMC. However, this major level turned into support, holding the decline. This week buyers have resumed control and despite the dip after the soft jobless claims today, we are keeping a bullish bias, going long on the US dollar against the Swiss Franc.

USD/CHF Chart H4 – MAs Continue to Support the Bullish Trend

Earlier last week, USD/CHF broke through resistance and climbed to the 0.9220s zone. However, there was a drop below this level following the Federal Open Market Committee (FOMC) meeting and the softer NFP (Non Farm Payrolls). However despite the drop, the previous barrier zone around the 0.90 level acted as support, being helped by the 100 SMA (red) on the H4 chart. This week the price has been mostly bullish, indicating a shift in the dynamics of the exchange rate.

The Weekly US Initial and Continuing Unemployment Claims

• Initial jobless claims came in at 231K, surpassing the estimate of 215K. This represents an increase from the prior week’s figure, which was revised slightly upward from 208K to 209K.
• The 4-week moving average of initial jobless claims stands at 215K, slightly higher than the 210.25K reported last week.
• Continuing claims remained unchanged from the estimate at 1.785M.
• The 4-week moving average of continuing claims decreased slightly to 1.781M from 1.787M reported last week.

The recent increase in initial claims represents the highest level observed since August last year. There may be some influence from the Easter weekend, although this factor doesn’t usually alter seasonality significantly. Interestingly, the number of continuing claims remained unchanged.

Historically, spikes in initial claims tend to rotate lower shortly afterward. Therefore, in the coming weeks, it will be crucial to observe whether this recent increase is indicative of a new trend or just an aberration. In the financial markets, Treasury yields turned lower, while the US stocks has managed to erase the Nasdaq’s declines from pre-market losses, since lower higher unemployment claims mean that the FED has more reasons to turn dovish and start cutting interest rates.

USD/CHF Live Chart