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Forex - USD/CHF weekly outlook: October 21 - 25

Published 10/20/2013, 06:10 AM
USD/CHF
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Investing.com - The U.S. dollar ended the week sharply lower against the Swiss franc on Friday on concerns that the Federal Reserve will have to keep its stimulus program in place for longer in the aftermath of the U.S. government shutdown.

USD/CHF ended Friday’s session at 0.9019, dipping 0.06% for the day, after hitting lows of 0.9003. The pair ended the week with losses of 1.04%.

The pair is likely to find support at 0.8966, the low of October 3 and a 20 month low and resistance at 0.9080.

The dollar tumbled more than 1% against the Swissy on Thursday after the U.S. Congress passed a bill to reopen the government and raise the debt ceiling, with just hours to spare ahead of a deadline to avert an unprecedented sovereign debt default.

The deal will fund the government until January 15 and raise the government borrowing limit until February 7. Both sides also agreed to talks over broad budget issues in an attempt to reach a longer-term deal by December 13.

The drop in the dollar came amid fears that the impact of the government shutdown on the already fragile economic recovery would prompt the Fed to delay plans for tapering its asset purchase program until at least the beginning of next year.

The possibility of another debt crisis also loomed, as the temporary solution does not resolve the underlying budgetary issues dividing Republicans and Democrats.

In the week ahead, U.S. data releases will be in focus after the shutdown delayed the release of some key economic reports. The Department of Labor is to publish the September nonfarm payrolls report on Tuesday and data on durable goods orders is to be released on Friday.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, October 21

The U.S. is to release private sector data on existing home sales, a leading indicator of demand in the housing sector.

Tuesday, October 22

The U.S. is to publish the September nonfarm payrolls report, which had been originally scheduled for release on October 4.

Wednesday, October 23

The U.S. is to publish data on import prices, a leading contributor to inflation.

Thursday, October 24

The U.S. is to release the weekly report on initial jobless claims, as well as data on new home sales.

Friday, October 25

The U.S. is to round up the week with data on durable goods orders, a leading indicator of production, as well as revised data on consumer sentiment from the University of Michigan.




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