The US dollar has gone back and forth during the Friday session, as we are looking to try to break free of the negativity. The interest rate differential will continue to be a main driver here.
USD/CHF
The US dollar has gone back and forth during the trading session here on Friday as the 0.80 level opens up the possibility of a bounce and support. This is an area that's been a significant barrier, and ultimately, I think we've got a situation where traders are trying to pick up cheap US dollars. The interest rate differential, of course, favors the US dollar, and I think that will continue to be the way going forward.
Top Regulated Brokers
Ultimately, I think this pair will probably continue to find reasons to go higher, and sooner or later, traders will take advantage of the interest rate differential and the fact that they get paid at the end of every session. I'm looking at this pair moving to the 0.8150 level initially and then much higher than that, possibly as high as 0.85.
Central Bank Policy and Interest Rate Dynamics
The Swiss National Bank doesn't like the idea of a strong Swiss franc so they are perfectly comfortable with the idea of this pair going higher and quite frankly the Federal Reserve, despite the fact that we had gotten weaker than anticipated jobs numbers on Thursday, will still have to worry about inflation and traders are still thinking that perhaps the Fed will raise interest rates once or twice between now and the end of the year.
With this, I think we have to believe that the market will continue to see a lot of volatility, but I think the buyers are going to continue to strengthen. I have no intention of shorting this pair anytime soon, and believe that buying dips continues to be the answer.
Ready to trade our daily forex forecast? Here are the best online trading platforms in Switzerland to choose from.