AUD/CHF Faces Bearish Pressure as Sellers Target Key Trendline Break

Market Overview

The Australian dollar (AUD) faced renewed selling pressure against the Swiss franc (CHF) at the start of the week. Market sentiment was weighed down by uncertainty surrounding U.S. tariff policies under President Donald Trump and weaker-than-expected Chinese manufacturing data. This weakness coincided with subdued trading volumes as major Asian markets, including Australia, observed the Chinese New Year holiday. Monday’s data revealed an unexpected contraction in Chinese manufacturing activity in January, highlighting the limited impact of recent stimulus measures from Beijing. Furthermore, the non-manufacturing sector also registered a significant slowdown, underscoring challenges faced by local businesses amid potential tariff increases from the U.S.

The combination of a stronger U.S. dollar and weakening economic indicators in China has exacerbated bearish sentiment for the AUD, a currency closely tied to global risk sentiment and Chinese economic performance. In contrast, the CHF, often viewed as a safe-haven currency, benefitted from the risk-off environment, contributing to the AUD’s depreciation against the franc.

Technical Analysis

On the hourly chart, AUD/CHF is attempting to break below a key ascending trendline, reflecting intensified bearish momentum. Sellers have successfully pushed the price below the recent support level at 0.56972, signaling growing downward pressure. The immediate target for sellers lies at 0.56939, which aligns with the 23.6% Fibonacci retracement of the previous upswing.

Should this level fail to hold, further downside objectives are anticipated at 0.56896 and 0.56849, corresponding to subsequent support zones. Indicators further reinforce the bearish narrative. The RSI remains below the neutral 50 level, highlighting dominant selling momentum without approaching oversold territory. Meanwhile, the MACD continues to trend downward, with its signal line remaining below the zero line, confirming the persistence of bearish momentum.

Conversely, if buyers regain control, they must push the pair above 0.56972 to challenge the next resistance levels at 0.57019 and 0.57095. A sustained move above these levels would invalidate the bearish outlook, potentially signaling a recovery toward higher price zones.

Key Technical Levels

• Resistance Levels: 0.56972, 0.57019, 0.57095
• Support Levels: 0.56939, 0.56896, 0.56849

Fundamental Factors

The AUD is under pressure amid broader market concerns related to U.S. tariff policies and disappointing Chinese economic data. These developments have compounded existing vulnerabilities for the Australian economy, heavily reliant on trade with China. Meanwhile, the Swiss franc continues to benefit from its status as a safe-haven currency in periods of heightened uncertainty.

Key events likely to influence this pair include a speech by Andréa Maechler, a senior member of the Swiss National Bank’s governing board, scheduled later today. Investors will look for clues regarding the central bank’s monetary policy stance and its view on the franc’s strength. Additionally, the release of Australia’s business confidence data on Tuesday could further impact the AUD by offering insights into local economic conditions.

Conclusion

AUD/CHF is experiencing bearish momentum as sellers intensify pressure on key technical levels. The trendline break could pave the way for further downside if support levels fail to hold. Investors should closely monitor upcoming economic events for additional catalysts influencing this pair.

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