The Swiss franc is gaining ground over the US dollar, but we could see the Swiss Franc lose ground after the fundamental news release from the US. They are releasing Initial Jobless claims in tomorrow's trading session; the previous week's figure reached 213K, and analysts expect this week's number to increase to 215K. The US has a very solid labor market that has remained unaffected by the Fed's efforts to slow down economic growth; we have been surprised by the US labor market's numbers in recent months.
Switzerland will release high-impact economic indicators on Friday; they will announce Retail Sales MoM, which is expected to increase from -0.5% to 0.6%, while analysts anticipate Retail Sales YoY to decline slightly from a previous figure of 2.6% to 2% in August, this economic indicator is an excellent way to gauge the economic activity in the country.
Later in the day, Switzerland will also release the KOF Leading Indicators, where the KOF Swiss Economic Insitute gauges business leaders' optimism about the economy's performance and their organization's prospects. This indicator is expected to drop from the previous figure of 86.5; expert consensus is at 84.5.
The US will release indicators on Personal Spending MoM, Personal Income MoM, and Michigan Consumer Sentiment on Friday's trading session. These economic indicators will cause turbulence in the markets as they gauge how much people spend on goods and services, how much they make, and how they perceive the future for their financial situation.
Experts anticipate Personal Spending MoM to increase from 0.1% to 0.2%. Personal Income is expected to grow from 0.2% to 0.3%, and Michigan Consumer Sentiment is also expected to increase from 58.2 to 59.5. This is not very good news for the Federal reserve as they continue intensifying the efforts to restore price stability by hiking rates, which is meant to slow down economic activity.
The general trend continues to be downwards as the price is still trading above short and long-term moving averages. The price could find support at the 61.8% Fibonacci retracement at 0.97209.
The Bollinger bands are flattening, suggesting that the price could enter a consolidation phase. The bands are still wide enough to expect high volatility in the upcoming trading sessions.
The relative strength index is at 54%, a very neutral level that will allow the pair to move in either direction before entering an oversold or overbought status. The USD is down 1.8% in the last two trading sessions, but this retracement could be good for the US dollar as it will grab momentum after the pullback.
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