USD/CHF Price Forecast: Strong bullish momentum drives gains to highs near 0.8300

• Buying momentum lifts USD/CHF to a fresh two-week high of 0.8286 so far, taking its gain beyond 1% in less than two days.
• Growing investor bets on further Fed tightening in December drive broad-based gains in the USD.
• Resistance between 0.8300 and 0.8315 is likely to challenge US Dollar buyers.

Broad US Dollar (USD) strength and pressure on the Swiss Franc (CHF) are driving USD/CHF higher on Wednesday. Rising expectations of a Federal Reserve (Fed) rate hike in December are supporting the USD, while improved risk appetite and an adverse monetary policy divergence weigh heavily on the CHF. Since the US inflation release, USD/CHF has gained more than 1%, reaching a two-week high of 0.8286 so far.

Tuesday's stronger-than-forecast US Consumer Price Index (CPI) readings reinforced expectations of additional Federal Reserve tightening in December, helping the Greenback outperform other major currencies on Tuesday.

Comments from Fed officials earlier on Wednesday lent support to those expectations. Philadelphia Fed President Anna Paulson advocated “further gradual tightening” to return inflation to target. Later, Dallas Fed President Lorie Logan stated that “it is clear that the Fed needs at least two more quarter-percentage-point  increases.”

According to the CME’s FedWatch Tool, futures markets have almost fully priced in a December rate hike, including a 12% probability of a 50 basis points increase. By contrast, the Swiss National Bank (SNB) is not expected to lift its benchmark interest rate above the current 0% level anytime soon. With markets favouring riskier assets, this divergence places considerable pressure on the Swiss Franc.

Technical Analysis: Could Resistance Near 0.8300 Check the Bulls?

A nearly 2% recovery from last week's lows leaves USD/CHF trading at 0.8283 with a positive near-term bias. Strong upward momentum is evident on the four-hour charts: the Relative Strength Index (14) is approaching overbought territory, while the Moving Average Convergence Divergence (MACD) histogram displays expanding green bars.

The next major hurdle for buyers is likely to be the zone from 0.8295 to the October 28 high of 0.8313. At 0.8295, the October 29 low coincides with the 61.8% Fibonacci retracement of the October-November correction. A break above this zone would put the October 15 high around 0.8350 in focus, followed by the long-term high of 0.8395 recorded in mid-October.

Any bearish move is likely to encounter an initial test at the session low of 0.8248. Further down lie the top of last week's range around 0.8225 and the lows recorded on Monday and Tuesday at 0.8174.

(The technical analysis of this story was written with the help of an AI tool. Know more.)