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The USDCHF initially pushed higher in the early U.S. session, breaking above the 200-hour moving average at 0.8001. That move came in tandem with the EURUSD’s drop following the initial reaction to the ECB policy announcement.
However, the rally was short-lived. A sharp spike in U.S. initial jobless claims to 263K vs. 235K expected quickly flipped the script. Sellers stepped in, driving the pair back down toward the falling 100-hour moving average at 0.7967. On the first test, support buyers leaned against the level, giving the pair a modest bounce.
At the moment, the pair is trading near 0.7973. The short-term bias has tilted slightly to the downside after the failed break above the 200-hour MA and the subsequent fall back below the 38.2% retracement of the move lower from last week’s high. That level comes in at 0.7975.
That said, the 100-hour MA at 0.7967 remains the key risk-defining level. If price holds above it, buyers may continue to defend and look for a rebound toward the topside. A sustained move below, however, would open the door for a deeper correction lower.
Overall, the buyers had their shot. They failed. The sellers are taking their shot. Will they be able to push below the 100-hour moving average, or is the battle between 100 and 200-hour moving averages what traders are focused on?
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