The SNB cut rates by 50 basis points to 0.50% from 1.00%, exceeding market expectations of a 25 basis point cut. Following the announcement, the USD/CHF pair climbed from 0.8820 to 0.88937, near the top of a key swing area on the hourly chart, between 0.88808 and 0.88941. Sellers initially rejected the move at this resistance zone.

The price subsequently retraced to a low of 0.88516 before bouncing back. It then broke above the swing area high of 0.8894, briefly surpassing the psychological resistance at 0.8900, reaching a high of 0.8901. However, the pair rotated back down toward the lower boundary of the swing area near 0.8880.

Key Levels and Scenarios:

Support Zone: 0.8880 – A hold here could signal a potential upside rotation.
Immediate Resistance: 0.8900 – Clearing this level could target the next swing area between 0.8914 and 0.8923.
Upside Target: 0.8957 – The November high, following a break above 0.8923.

Buyers currently maintain control above 0.8880, but a break below this level could lead to disappointment and further downside probing.

This article was written by Greg Michalowski at www.forexlive.com.