“¢ The USD remains support by Friday’s mostly upbeat economic data/positive bond yields.
“¢ The prevalent risk-on mood dents CHF’s safe-haven appeal and provides an additional boost.
The USD/CHF pair climbed to two-month tops during the early European session on Tuesday, with bulls eyeing a follow-through move beyond the parity mark.
The pair built on last week’s goodish bounce from the very important 200-day SMA support near the 0.9900 handle, with a combination of supporting factors fueling the ongoing positive momentum for the fourth consecutive session.
Against the backdrop of Friday’s mostly upbeat US economic data, a follow-through pickup in the US Treasury bond yields helped the US Dollar to recover all of its losses triggered by a dovish FOMC message.
This coupled with improving risk sentiment, as depicted a goodish up-move across European equity markets, dampened the Swiss Franc’s relative safe-haven status and provided an additional boost to the major.
It would now be interesting to see if bulls are able to maintain their dominant position or continue with their struggle to preserve/build on the momentum further beyond the key psychological mark.
Moving ahead, today’s US economic docket, highlighting the release of US ISM non-manufacturing PMI, will now be looked upon for some fresh impetus later during the early North-American trading session.
Technical levels to watch
A follow-through buying beyond the mentioned barrier has the potential to lift the pair further towards the 1.0055-60 supply zone en-route the 1.0100 round figure mark. On the flip side, the 0.9975-70 region now seems to protect the immediate downside, which if broken might prompt some aggressive long-unwinding trade and accelerate the fall towards 0.9940 horizontal support before the pair eventually drops to challenge the 0.9900 handle (200-DMA).
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