USD/CHF soars to 2-month high as fear and greed index slides to 38
- The USD/CHF price rose today even after the strong economic data from Switzerland.
- Retail sales rose in December while the manufacturing PMI rose in January.
- The fear and greed index has dropped as investors rush to safe havens like the dollar.
The USD/CHF price broke-out above a key resistance level on the back of a stronger US dollar. It is trading at 0.8955, which is the highest it has been since December 2.
Strong Switzerland data
The USD/CHF price is rising even after the relatively strong economic data from Switzerland. In a report released by the country’s statistics agency, the overall retail sales continued recovering in December.
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The sales rose by 4.7% in December from 1.8% in the previous month. It was also the eighth consecutive month that the sales have been rising after they dropped by 19% in April last year. Also, it was the strongest data since May.
Further data showed that the manufacturing sector continued to rebound in January. The Swiss manufacturing PMI rose to 59.4 in January from 58.0 in December. This was the strongest figure since October 2018 and is the third consecutive month of gains.
Therefore, the USD/CHF is rising because of the overall stronger dollar. The dollar index has risen by more than 0.30% today. Individually, the dollar has risen by 0.50% against the Swedish krona, 0.45% against the euro, and by 0.30% against the Canadian dollar,
This performance is partly due to the ongoing risks in the market where traders in social media are pushing risky assets higher. Today, XRP, a digital currency created by Ripple has surged by more than 40% while silver has climbed to its highest level since 2018. Indeed, as shown below, the fear and greed index has dropped to 38. This is a sign that there is a general fear in the market. And in times of fear, forex investors tend to rush to the safety of the dollar.
USD/CHF technical outlook
The USD/CHF price bottomed at 0.8756 in January. Since then, it has jumped by about 2.37% and today, it moved above the important resistance at 0.8925. The price has also formed an inverse head and shoulders pattern while the 25-day and 15-day exponential moving averages (EMA) have made a bullish crossover.
Therefore, with bulls in control, there is a possibility that the pair will soar to the next resistance at 0.900. This is both a vital psychological level and also a place where it formed a double-bottom last year.