USD/CHF approaches 2018 peak above parity as DXY advances to 4-month highs

• US Dollar Index rises above 97 for the first time since late June.
• Wall Street looks to end the day modestly higher.

After taking a break above the parity mark in the early NA session, the USD/CHF resumed its rally and touched its highest level since July 13 at 1.0052 as the greenback continued to gather strength. As of writing, the pair was trading at 1.0050, adding 0.3% on the day.

The strong macroeconomic data releases from the United States and rising Treasury bond yields fueled the US Dollar Index’s upsurge on Tuesday. Additionally, the selling pressure surrounding major European currencies such as the euro and the British pound amid ongoing political concerns force investors to look for better alternatives.

Earlier today, the data from the United States showed that the S&P/Case-Shiller Home Price Index rose 5.5% on a yearly basis in August and the Conference Board’s Consumer Confidence Index rose to 137.9 in October from 135.3 in September. The US Dollar Index, which failed to break above the 97 mark back in August, advanced to its highest level in more than four months at 97.02.  

In the meantime, major equity indexes in the U.S. are clinging to their gains on Tuesday with the Dow Jones Industrial Average looking to close the session around 1% higher and making it difficult for safe-havens like the CHF find demand and stage a recovery.

Technical levels to consider

The pair could face the next  resistance  at 1.0070 (Jul. 13 high – 2018 high)  ahead of 1.0100 (psychological level) and 1.0170 (Mar. 7, 2017, high). On the downside, supports are located  at 1.000 (parity), 0.9940 (20-DMA) and 0.9850 (Oct. 15 low).