Diverging Dollar: USD/JPY and USD/CHF on Different Paths
The US dollar is experiencing mixed performance across major currencies. The USD/CHF pair continues to exhibit a strong bullish structure, while momentum in USD/JPY has begun to fade.
Another indicator of potential divergence between the two pairs may be seen in CHF/JPY's countertrend rally approaching a resistance cluster that could favor renewed Swiss franc outperformance against the Japanese yen.
The daily chart shows EUR/USD and GBP/USD at an eight-day low, but downside volatility is lower than during last week's selloff. USD/CAD is the standout performer due to Canadian dollar weakness, while NZD/USD has formed a volatile bullish outside day.
In technical analysis of USD/CHF, the daily trend structure resembles that of a stock market, with a strong rally forming from its lower trend channel since August. The four-day pullback is losing momentum and hinting at a swing low.