Bearish Outlook Persists as AUDCHF Struggles to Break Above Resistance

Summary:

A renewed rejection near resistance could therefore indicate that selling pressure is returning, potentially opening the way for a deeper correction.

Sell AUDCHF

End Time

CLOSED

0.58100

ENTRY

0.57300

TGT

0.58500

0.57426 +0.00238 +0.42%

400

Points

Loss

0.57300

TGT

0.58505

CLOSING

0.58100

ENTRY

0.58500

The Swiss National Bank (SNB) Vice Chairman Antoine Martin acknowledged early on Thursday that the economic outlook remains subject to a significant degree of uncertainty. However, Martin ruled out interest rate increases in the near term, stating that “We remain comfortably within the 0% to 2% price stability range.” His comments suggest that the current inflation environment does not warrant an immediate tightening of monetary policy, despite the uncertainty surrounding the broader economic outlook.

Recently released Swiss Consumer Price Index (CPI) data showed that annual inflation accelerated to 1.0% in September from 0.8% in August. However, monthly inflation moderated to 0.0%, following the 0.4% increase recorded in the previous month. The figures indicate that annual price growth has picked up slightly, although the monthly reading points to a more contained pace of price increases.

Retail Sales, meanwhile, accelerated to an annual rate of 3.2% in August from 2.6% in July, outperforming market expectations for a moderate slowdown to 2.2%. The stronger-than-expected reading points to continued resilience in consumer spending. Nevertheless, the improvement in retail activity was not enough to offset the negative market impact of the weaker-than-expected inflation figures.

On October 12, the Reserve Bank of Australia (RBA) will release the minutes from its latest policy meeting, followed by employment data two days later. Money markets currently assign a 27% probability to another rate increase to 4.85% at the central bank’s next policy meeting. These upcoming releases could provide further insight into the direction of monetary policy, particularly as policymakers assess the persistence of inflationary pressures and the resilience of the Australian labor market.

Australian consumer inflation expectations rose to 5.3% in October from 4.9% previously, reaching their highest level in four months. The increase highlights persistent concerns about future price pressures, particularly as global energy costs continue to rise and could place additional pressure on household spending. If these expectations remain elevated, they could complicate the RBA’s efforts to bring inflation under control.

Former RBA board member Ian Harper also suggested that another rate increase before the end of the year remains a plausible scenario, although he does not consider it the most likely outcome. His comments reflect the uncertainty surrounding the monetary policy outlook as the central bank weighs persistent inflation risks against developments in economic activity. The upcoming minutes and employment report could therefore prove important in determining whether the current conditions justify further tightening. Bearish Outlook Persists as AUDCHF Struggles to Break Above Resistance_1

Bearish Outlook Persists as AUDCHF Struggles to Break Above Resistance_1

Technical Analysis

AUDCHF appears to be undergoing a downward correction after recently facing rejection at the 0.5809 resistance level. The rejection occurred when the price approached the 100-period moving average, which is currently positioned at 0.5814. For now, the pair could retest this resistance area, and another rejection would increase the possibility of the downward movement extending toward the next local support level at 0.5728. This area is near the 200-period moving average at 0.5752, which has continued to provide dynamic support during the broader upward movement. A renewed rejection near resistance could therefore indicate that selling pressure is returning, potentially opening the way for a deeper correction.

Regarding the oscillators, the RSI is currently at 44 and has recently struggled to establish a sustained move above the 52 level, quickly returning to bearish territory. If the indicator remains compressed below this area, downside momentum could accelerate again, reinforcing the possibility of a move toward local support. Meanwhile, the MACD shows a bullish histogram that is rapidly losing depth, raising the possibility of a bearish crossover. The signal lines have already moved into bearish territory, suggesting that upside momentum is weakening. As a result, the path of least resistance appears to remain to the downside, particularly if AUDCHF fails to break above resistance and the oscillators continue to signal deteriorating bullish momentum.

Trading Recommendations

Trading direction: Sell

Entry price: 0.5810

Target price: 0.5730

Stop loss: 0.5850

Validity: Oct 20, 2026 15:00:00

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