USD/CHF is expected to extend a bullish bias. The pair recorded a succession of higher tops and higher bottoms since May 8 and is holding on the upside. The relative strength index is above its neutrality level at 50 and lacks downward momentum. A support base has formed around 1.0055, which should limit the downside potential.
The U.S. dollar remains firm as investors are still optimistic about the economy and expect the Federal Reserve to raise interest rates next month. Meanwhile, the U.S. Labor Department reported that import prices increased 0.5% on month in April, much faster than +0.1% expected. At the same time, Federal Reserve Bank of Boston President Eric Rosengren confirmed that the Fed could raise interest rates three more times this year.
As long as this key level is not broken, look for a further upside toward 1.0125 and even 1.0160 in extension.
Resistance levels: 1.0125, 1.0160, and 1.0095
Support levels: 1.0020, 0.9975, and 0.9930
The material has been provided by InstaForex Company – www.instaforex.com