The US dollar is showing signs of life against the Swiss franc and Japanese yen, with both USD/CHF and USD/JPY reclaiming critical simple moving averages (SMAs) in recent trading. This technical recovery could have implications for the broader macro environment, potentially influencing risk assets like Bitcoin and cryptocurrencies.
USD/CHF Bounces from 20-Day SMA
The USD/CHF pair has recaptured the 0.8100 handle after bouncing off the 20-day SMA, a level that has provided support in recent sessions. As of the latest data, the pair is hovering around 0.8105, up from an intraday low of 0.8078. The recovery came amid a mild softening in the greenback as markets reassess the pace of Federal Reserve rate cuts for 2025. Immediate resistance now stands at the 50-day SMA near 0.8120, followed by the psychological 0.8150 level. On the downside, the 20-day SMA at 0.8080 acts as initial support, with a break below opening the door to 0.8050. Momentum indicators are mixed: the Relative Strength Index (RSI) has ticked up from oversold territory but remains below 50, indicating that while buying pressure is improving, the broader trend remains uncertain.
USD/JPY Bulls Reclaim 200-Day SMA
Meanwhile, USD/JPY has staged a more significant technical move, with bulls retaking the 200-day SMA—a widely watched long-term trend gauge—during the latest trading session. The pair is now facing immediate resistance at the 155.00 psychological level, with the 156.50 region acting as a previous ceiling. The 200-day SMA at around 153.80 now serves as the first support, and a break below could lead to a test of the 152.00 area. The recovery has been fueled by a rebound in US Treasury yields, but upside may be capped by market expectations of further rate cuts by the Fed later this year.
Central Bank Divergence in Focus
The fundamental backdrop remains a tug-of-war between the Federal Reserve and its Swiss and Japanese counterparts. The SNB has historically intervened to weaken the franc during periods of excessive strength, which could limit USD/CHF upside. For USD/JPY, the policy divergence between the Fed and the Bank of Japan—where the BoJ is gradually normalizing while the Fed might cut—keeps the pair sensitive to economic data. Upcoming US inflation and employment figures will be crucial in shaping the next dollar move.
For crypto traders, a strengthening dollar often translates into headwinds for Bitcoin and altcoins, as the historical inverse correlation comes into play. However, if the dollar’s recovery proves short-lived or is driven by risk-on sentiment, the impact could be neutral or even positive. The technical reclaims are constructive, but confirmation above key resistance levels is needed before drawing conclusions about a sustained greenback rally.
