Dollar reverses thanks to the NFP data
02 December 2022
Today, traders were waiting for the NFP data from the US. The number came much better than expectations and this is so far used to buy Dollar. This move came right on time as on many instruments, USD was about to break important supports, which would open a way to further weakening. For example on USDCHF, the hero of this analysis.
USDCHF was falling sharply from the beginning of November. The previous month was one of the worst in recent history. USDCHF lost almost 5.6% and that was the most in one month since January 2015! Weakness continued yesterday and today but the NFP brought an impulse for a bullish reversal. On USDCHF the key here is the place, where this bounce happened. The price was on a combination of two key supports. The first one was the long-term up trendline (black) and the second one was the horizontal support around 0.936 (yellow), which played an important role since September 2021.
The bounce from today shows us the rejection of lower levels and gives hope for the mid-term bullish correction. The sentiment is positive and we have bigger chances for a further rise. Price closing a day below today’s lows would immediately cancel that positive sentiment but chances for that happening are rather low.