- US Dollar Index consolidates daily losses near mid-94s.
- Personal spending and core-PCE price index will be released from the U.S. next.
After losing its bullish momentum ahead of the critical parity mark on Thursday, the USD/CHF erased a big portion of its daily gains in the first half of the last trading day of the week. As of writing, the pair was down 55 pips on the day at 0.9920.
The pair’s sharp fall on Friday seems to be the product of a broad-based USD sell-off. The US Dollar Index, which failed to hold above the 95 mark today, made a deep correction in the early trading hours of the European session and was last seen at 94.50, where it was down 0.55% on the day.
Meanwhile, recent reports claiming that President Trump was planning to withdraw the U.S.from the World Trade Organization seem to be further weighing on the greenback.
Today’s data releases from the United States will include personal spending, personal income, and core-PCE price index, the Fed’s preferred measure of inflation. The core-PCE price index is expected to improve to 1.9% in May on a yearly basis from 1.8% in April. A higher reading is likely to help the DXY recover toward the 95 mark toward the end of the week as it would heighten the expectations of another rate hike in September.
Technical levels to consider
The first support for the pair could be seen at 0.9890 (Jun. 27 low) ahead of 0.9840 (Jun. 13 low) and 0.9790 (Jun. 7 low). On the upside, resistances align at 1.0000 (parity/psychological level), 1.0055 (May 9 high) and 1.0100 (May. 11, 2017, high).
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