USD/CHF Price Forecast: Reaches highs near 0.8300 amid strong bullish traction

• USD/CHF appreciates more than 1% in less than two days and hits fresh two-week highs at 0.8286 so far.
• The USD appreciates across the board, as investors ramp up bets on further Fed tightening in December.
• US Dollar bulls are likely to meet resistance in the area between 0.8300 and 0.8315.

The US Dollar (USD) rallies Wednesday, fuelled by higher bets of a Federal Reserve (Fed) rate hike in December, with the Swiss Franc (CHF) crushed by higher appetite for risk and an unfavourable monetary policy divergence. The USD/CHF has jumped more than 1% since the release of US inflation data to reach two-week highs at 0.8286 so far.

The Greenback is outperforming its peers on Tuesday, as the hotter-than-expected US Consumer Price Index (CPI) figures released on Tuesday cemented hopes of further Federal Reserve tightening in December.

These views have been validated by Fed officials earlier on Wednesday. The President of the Philadelphia Fed, Anna Paulson, called for a “further gradual tightening” to bring inflation to target, and somewhat later, Dallas Fed President Lorie Logan said that “it is clear that the Fed needs at least two more quarter-percentage-point  increases.”

The CME’s FedWatch Tool shows that futures markets are practically discounting a rate hike in December, with a 12% chance of a 50 basis points hike priced in. The Swiss National Bank (SNB), on the contrary, is not expected to raise its benchmark interest rate from the current 0% level anytime soon. This, in times of risk-on markets, poses a heavy burden on the Swissie.

Technical Analysis: Bulls might find resistance around 0.8300

USD/CHF trades at 0.8283, retaining a constructive near-term bias after rallying nearly 2% from last week's lows. Four-hour charts show strong bullish momentum, with the Relative Strength Index (14) nearing overbought territory and the Moving Average Convergence Divergence (MACD) histogram showing widening green bars.

Bulls, however, are likely to face significant resistance in the area between 0.8295, where the October 29 low meets the 61.8% Fibonacci retracement of the October-November correction, and the October 28 high, at 0.8313. Above here, the next target is the October 15 high in the 0.8350 area ahead of the long-term high, at 0.8395, hit in mid-October.

On the downside, the session low at 0.8248 is likely to test bearish attempts ahead of last week's range top, at the 0.8225 area, and Monday and Tuesday's lows, at 0.8174.

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