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Intraday Market Analysis – CHF Bounces Back

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USDCHF breaks support

The Swiss franc soared after the SNB delivered a surprise 50-basis-point rate hike. The dollar came to a halt at May’s peak at 1.0050. A bearish divergence indicated a slowdown in the upward momentum. Then a fall below the base of the latest rebound at 0.9880 acted as a confirmation of a correction. Heightened volatility suggests that short-term buyers have bailed out and a break below 0.9780 further weighs on sentiment. 0.9550 is a critical floor to keep June’s rally intact. The bulls need to clear 0.9820 first to ease the pressure.

GBPUSD attempts to rebound

The pound rallied after the BoE raised its interest rates to 1.25%. A surge above 1.2200 has forced sellers to cover their positions, paving the way for a sharp rebound. A combination of profit-taking and momentum buying is propelling Sterling to the supply zone around 1.2500. Strong selling pressure could be expected though as the medium-term trend remains bearish. An overbought RSI may trigger a limited pullback as intraday traders take profit. 1.2050 at the origin of the rally is a major support should this happen.

SPX 500 falls into bearish trend

The S&P 500 struggles as the FOMC anticipates an economic downturn. A fall below the daily support at 3840 which has turned into a resistance might confirm the bear market. Sellers would continue to fade rebounds as sentiment deteriorates. The RSI’s dip into the oversold area may prompt some short-term sellers to cover. But unless the buy side manages to lift offers around 3840, the index could be vulnerable to a new round of sell-off. 3550 from November 2020 would be the next target.

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