- USD recovery on Friday helps USD/CHF retrace yesterday’s losses.
- Wall Street opens the last trading day of the week in the red.
- The pair remains on track to make its fifth straight negative weekly close.
After spending the Asian session in a very tight range near the 0.98 mark, the USD/CHF pair was able to gather some bullish momentum on the back of a stronger greenback. Nonetheless, the pair encountered a technical resistance ahead of 0.99 and was last seen trading at 0.9870, where it was up 0.65% on the day.
The market’s USD valuation is the primary driver of the pair’s price action on Friday. The US Dollar Index, which plummeted to a multi-week low near 93.20 on Thursday, staged a technical correction today and rose above mid-93s. However, this move hadn’t been supported by a fundamental catalyst and it’s unlikely for the greenback to extend its recovery gains above the 94 handle in the near-term.
Meanwhile, reflecting a negative market sentiment, major equity indexes in the United States opened lower on Friday and capped the pair’s upside with CHF showing some resilience as a traditional safe-haven. At the moment, the Dow Jones Industrial Average is down 0.05% while the S&P 500 is losing 0.25%.
Despite today’s rise, however, the pair remains on track to record its fifth straight negative weekly close. Since having failed to stay above the critical parity mark in early May, the pair lost more than 200 pips.
Technical outlook
Technical supports for the pair align at 0.9800 (psychological level/100-WMA/daily low), 0.9770 (Apr. 24 low) and 0.9710 (Apr. 29 low). On the upside, resistances could be seen at 0.9910 (Jun. 1 high), 1.0000 (psychological level/parity) and 1.0055 (May 10 high).
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