- US Dollar Index rises above 96.60 on Thursday.
- Wall Street recovers the majority of Wednesday’s losses.
- Durable goods orders in the U.S. beat expectations.
The USD/CHF broke above the critical parity level for the first time in more than three months on Thursday as the greenback continued to gather strength against its peers. As of writing, the pair was trading at 1.0005, gaining 0.25% on a daily basis.
After closing the previous day higher, the US Dollar Index stayed quiet during the first half of the day as investors refrained from making large bets ahead of the ECB announcements and President Draghi’s press conference. With Draghi sounding a little more cautious than expected, the shared currency lost interest and markets continued to price hawkish Fed expectations. The DXY surged to its highest level in 10 weeks at 96.68 during the American trading hours before going into a consolidation phase. At the moment, the index is up 0.28% on the day at 96.63.
Additionally, today’s data from the U.S., which showed a bigger-than-expected increase in orders for manufactured durable goods and a strong rebound in pending home sales, helped the dollar preserve its momentum.
- US: Orders for durable goods in Sep. increased 0.8% to $262.1 billion.
- US: Pending home sales rise 0.5% in September following August’s 1.9% decline.
In the meantime, following yesterday’s disappointing performance, Wall Street took advantage of the upbeat earnings reports of tech-giants and retraced the majority of its drop to reflect a high appetite for risky assets, which weighs on the market demand for safe-havens such as the CHF.
Technical levels to consider
With a daily close above 1.000 (parity/psychological level), the pair could aim for 1.0035 (Jul. 18 high) and 1.0070 (Jul. 13 high). On the downside, supports align at 0.9920 (20-DMA), 0.9850 (Oct. 15 low) and 0.9810 (200-DMA).
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