Anna 
The USD/CHF pair continues its upward momentum, reaching 0.8860 during the European session on Friday. The Swiss Franc strengthens against a firm US Dollar, boosted by positive expectations that the Swiss National Bank (SNB) may lead a rate-cut cycle.
The US Dollar Index (DXY), measuring the Greenback against major currencies, has stabilized around 104.20 following a robust recovery from 103.70. The appeal for the US Dollar is supported by the release of higher-than-expected monthly core Personal Consumption Expenditure Price Index (PCE) data for January. This suggests that the Federal Reserve’s path to achieving 2% inflation could face challenges, as monthly core inflation grew by 0.4%, surpassing the 0.2% required for price stability.
Concurrently, easing price pressures in the Swiss economy have heightened expectations of rate cuts by the SNB in March. January’s inflation figures fell to 1.3%, missing the expected 1.7%, prompting the SNB to adopt a more dovish monetary policy stance.
Today’s focus for market participants centers on the US ISM Manufacturing PMI for February, expected to be published at 15:00 GMT. Forecasts suggest a reading of 49.5, slightly higher than January’s 49.1 but still below the critical 50.0 threshold.
The USD/CHF pair has exhibited a bullish trend, breaking out of a consolidation range between 0.8778 and 0.8824 in the four-hour timeframe. The breakout, marked by a volatility expansion and increased volume, signals a bullish sentiment. The 20-period Exponential Moving Average (EMA) at 0.8821 indicates a positive near-term outlook.
The 14-period Relative Strength Index (RSI) has shifted into the bullish range (60.00-80.00), signaling positive momentum.
To the upside, a break above the three-month high at 0.8886 could lead to further gains, targeting levels around 0.8932 and 0.8976. Conversely, a breakdown below the support at 0.8746 might expose the pair to levels around 0.8700 and 0.8650.
