Technical Retracements May Offer Strategic Buying Entries Within a Defined Uptrend

Forex

Economic

Summary:

This configuration suggests that the current move is a healthy technical correction rather than a structural trend reversal.

BUY AUDCHF

EXP

TRADING

0.54500

Entry Price

0.55060

0.54300

0.54609 -0.00016 -0.03%

0.0

Pips

Flat

0.54300

Exit Price

0.54500

Entry Price

0.55060

Headline inflation in Australia is projected to exhibit a marginal deceleration throughout January, with the Consumer Price Index (CPI) expected to descend to 3.7% year-over-year, down from the 3.8% recorded in December. Simultaneously, the trimmed mean CPI—the Reserve Bank of Australia’s (RBA) preferred gauge for underlying price pressures—is anticipated to remain stagnant at 3.3% annually. This suggests that the core inflationary drivers have yet to show a definitive sign of cooling, keeping the central bank in a state of high vigilance.

Against this backdrop, market participants have begun pricing in a potential interest rate hike in March with renewed conviction. This hawkish shift is bolstered by robust domestic data and increasingly restrictive rhetoric from monetary policymakers. Immediate market attention is now fixed on Tuesday’s inflation data, which acts as a critical catalyst that could fundamentally reshape expectations for the RBA’s next strategic pivot.

Furthermore, the Australian labor market continues to display remarkable resilience. The national unemployment rate remained largely stable at 4.1% in January, supported by a vigorous performance in full-time employment. Given that this level sits comfortably below the RBA’s own projection of 4.3% for the second quarter of 2026, the case for a sustained restrictive stance remains strong. Governor Michele Bullock has consistently reiterated the bank's readiness to tighten further if the data warrants it. Her warnings regarding the structural nature of inflation suggest that any additional hikes could serve as a formidable anchor for carry trade flows, provided the broader global risk environment remains supportive.

In Switzerland, data released by the Federal Statistical Office revealed that production and import prices contracted by 0.2% month-over-month in January, defying expectations of a 0.1% increase and mirroring the previous month's decline. On an annual basis, these prices tumbled by 2.2%. Consequently, the Swiss Franc (CHF) has gained significant traction as investors recalibrate their expectations for the Swiss National Bank (SNB). With Swiss inflation printing at a marginal 0.1%—at the very bottom of the SNB's 0–2% target range—the likelihood of near-term rate cuts has diminished. This aligns with the consensus that the SNB will maintain its current policy status quo through the March meeting and potentially throughout 2026. Technical Retracements May Offer Strategic Buying Entries Within a Defined Uptrend_1

Technical Retracements May Offer Strategic Buying Entries Within a Defined Uptrend_1

Technical Analysis

From a technical perspective, AUD/CHF remains entrenched in a robust primary uptrend. This bullish trajectory is currently being reinforced by the 100 and 200-period Moving Averages (MAs), situated at 0.5458 and 0.5440, respectively. These averages have historically functioned as a reliable dynamic floor, catapulting the price higher upon every successful test.

Should the current corrective pattern persist, a fresh interaction with this support cluster may provide high-probability opportunities to join the dominant trend. Strategic buying interest is currently concentrated near the local ascending trendline.

Our momentum analysis via the RSI shows the indicator currently hovering at the 47 level, approaching technical neutrality. Notably, the 42 level on the RSI has recently acted as a springboard for bullish reversals; a move toward this level, in confluence with the horizontal support and the MAs, would solidify the case for a bullish pivot.

Meanwhile, the MACD is printing bearish histogram bars, though the signal lines remain comfortably above the neutral threshold. This configuration suggests that the current move is a healthy technical correction rather than a structural trend reversal. Traders should monitor for a transition back to a positive histogram; if the bullish bars gain significant depth, we anticipate a renewed impulse toward the local peak at 0.5506.

Trading Recommendations

Trading direction: Buy

Entry price: 0.5450

Target price: 0.5506

Stop loss: 0.5430

Validity: Mar 06, 2026 15:00:00

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Technical Retracements May Offer Strategic Buying Entries Within a Defined Uptrend

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