USD/CHF clings to modest daily gains, comfortably above mid-0.9700s

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  • The USD builds on the overnight rebound and remains supported by the ongoing recovery in the US bond yields.
  • Mnuchin’s positive trade-related comments lift global risk sentiment and undermine CHF’s safe-haven demand.
  • Market participants now eye Wednesday’s release of US durable goods orders data for some trading impetus.

The USD/CHF pair extended its sideways consolidative price action on Wednesday and remained well within the previous session’s broader trading range. 

A goodish US Dollar uptick, which got an additional boost from not so dovish remarks by St Louis Fed President James Bullard and the Fed Chair Jerome Powell, helped the pair to stage a solid intraday rebound from sub-0.9700 level, or fresh yearly lows on Tuesday.

The greenback built on its overnight steady recovery from multi-month lows and was further supported by a pickup in the US Treasury bond yields, which was eventually seen assisting the pair to hold with modest gains through the early European session on Wednesday.

This coupled with the latest positive comments by the US Treasury Secretary Mnuchin, saying that the US-China trade deal is 90% complete, lifted the global risk sentiment, which undermined the Swiss Franc’s safe-haven demand and remained supportive. 

It, however, remains to be seen if the pair is able to capitalize on the recovery move or meets with some fresh supply as the focus now shifts to the US President Donald Trump’s meeting with his Chinese counterpart Xi on the sidelines of G20 summit later this week. 

In the meantime, the US economic docket – featuring the release of durable goods orders data will be looked upon for some short-term trading opportunities later during the early North-American session on Wednesday.

Technical levels to watch

 

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