The US dollar slipped against the Swiss franc on Thursday, but a golden cross has formed as the 50-day EMA broke above the 200-day EMA. DailyForex analyst Christopher Lewis reads the setup as a buy-the-dips opportunity, with 0.80 holding as support and 0.85 as a longer-term target.
The dollar has drifted lower against the Swiss franc in early Thursday trading, yet DailyForex analyst Christopher Lewis sees the technical picture tilting bullish. A golden cross forms when a shorter moving average crosses above a longer one, and Lewis notes the 50-day EMA has broken above the 200-day EMA, which he says opens the possibility of a longer-term buy-and-hold scenario.
Lewis flags the 0.81 level as a short-term barrier, with the market still trying to build the momentum needed to break higher. Below price, he argues the 0.80 level continues to offer support.
Beyond the chart pattern, Lewis points to the interest rate differential still favoring the US dollar. He also notes the Swiss National Bank has no interest in letting the franc appreciate too quickly.
Given that setup, Lewis favors buying weakness rather than shorting. According to DailyForex, Lewis said he has “no interest in shorting” and would treat each dip as an opportunity on US dollar weakness.
Further out, he believes the pair will probably reach the 0.85 level, though he cautions it will take time to get there. Lewis expects continued volatility, but says traders get paid to hang on to the pair over time.
Source: DailyForex
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