Hotter US inflation and resilient retail sales fuel Fed rate hike bets, lifting the pair to a key resistance zone.
The USD/CHF pair climbed to a two-week high near 0.7865 in early European trading, extending its weekly uptrend for a fifth day. The move was driven by a stronger US Dollar, supported by rising expectations of a Federal Reserve interest rate hike in 2026 following higher-than-expected US inflation data and robust retail sales figures.
The pair now tests a critical resistance confluence, including the 38.2% Fibonacci retracement of its March-May decline and the 200-period Simple Moving Average. While momentum indicators show mixed signals—with the RSI in overbought territory—underlying bullish pressure persists, though a clear breakout remains uncertain.
Geopolitical tensions, including stalled US-Iran peace talks, further bolstered the USD’s safe-haven appeal, reinforcing the pair’s upward momentum.