- Swiss Franc fails to break a key technical level versus US Dollar.
- Greenback recovers ground against majors as Wall Street erases losses.
The USD/CHF pair dropped to 0.9691, reaching the lowest intraday levels since October of last years. However, like what happened in June and during the last three trading sessions, found support around the 0.9700 area and rebounded.
Equities and USD/CHF off lows
As of writing, it is hovering around 0.9735, modestly lower for the day, and far from the lows. The move to the upside took place amid a recovery in equity prices in Wall Street and higher US yields. The DOW JONES is falling less than a hundred points or 0.30%, hours ago it was losing 400 points.
Still, the Swiss Franc and equities remain under pressure as trade tensions between China and the US continue to weigh on market sentiment. The flight to quality eased over the last hours, but JPY and CHF are higher while gold heads for the first close above $1500/oz since 2013.
Technical outlook
The bias in the daily chart points to the downside but for the third time in July, it is rebounding from near the 0.9700 area. A failure to break the mentioned level should clear the way to a significant bullish correction.
A daily close clearly under 0.9700 would be the lowest in almost a year and would point to further losses with an immediate target around 0.9645/50.
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