US dollar remains weak after NFP, ahead of CPI. (Pivot Orderbook analysis)

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• US dollar remains weak after NFP, ahead of CPI.
• USDCHF extends its slide after finding resistance again at 1.0150.
• Next critical support is seen around 0.9850.

The pair currently trades last at 0.9904.

The previous day high was 1.0145 while the previous day low was 0.9932. The daily 38.2% Fib levels comes at 1.0013, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.0063, expected to provide resistance.

The USDCHF is falling on Monday for the second day in a row and it dropped to 0.9874, reaching the lowest level since October 27. It is hovering slightly below 0.9900, as the Swiss Franc holds to gains.

The key driver in the USDCHF slide continues to be a weaker US Dollar across the board. The greenback started to decline on Friday, after the US official employment report and amid risk appetite. Now, attention is set on the next inflation numbers due on Thursday with the Consumer Price Index for October that is expected to show a monthly increase of 0.7%.

But on Tuesday, the US holds its midterm elections. Analysts point out that the Republicans have the chance to regain control of Congress. “If Republicans retake one or both chambers of Congress, sweeping fiscal policy changes seem unlikely over the next two years, absent a crisis like the one that occurred in 2020. Under this election outcome scenario, we doubt we would make any major changes to our forecasts for GDP growth, inflation or the federal funds rate as a result of the election. Instead, status quo and political gridlock strike us as the most likely outcomes, with the possibility for some government shutdown/debt ceiling theatrics over the next two years”, said analysts at Wells Fargo.

The short-term bias points to the downside in USDCHF but it needs to break 0.9850 to signal further weakness ahead, targeting 0.9775. On the upside, above 1.0060 the greenback should recover momentum and could test again 1.0150. As long as it remains under 1.0150 gains seem limited.

Technical Levels: Supports and Resistances

EURUSD currently trading at 0.9904 at the time of writing. Pair opened at 0.9939 and is trading with a change of -0.35 % .

The pair is trading below its 20 Daily moving average @ 0.9989, above its 50 Daily moving average @ 0.9851 , above its 100 Daily moving average @ 0.9735 and above its 200 Daily moving average @ 0.9611

The previous day high was 1.0145 while the previous day low was 0.9932. The daily 38.2% Fib levels comes at 1.0013, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.0063, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.9866, 0.9792, 0.9653
• Pivot resistance is noted at 1.0079, 1.0218, 1.0291

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