- The USD fails to capitalize on FOMC minutes-led up-move.
- Cautious mood underpins CHF demand and capped gains.
- Traders now eye flash US PMI prints for short-term impetus.
The USD/CHF pair extended its sideways consolidative price action on Thursday and held stable near 2-1/2 week tops, comfortably above the 0.9800 round figure mark.
A combination of diverging forces failed to provide any meaningful impetus or assist the pair to build on the overnight goodish up-move and led to a subdued/range-bound price action through the early European session on Thursday.
Cautious mood seemed to cap the upside
Wednesday’s not so dovish FOMC meeting minutes tempered expectations of aggressive rate cuts and continued lending some support to the US Dollar – albeit bulls lacked any strong conviction amid the prevalent risk-off mood.
Persistent worries over prolonged US-China trade dispute seemed to weigh on the global risk sentiment, which was evident from a weaker trading sentiment around equity markets and benefitted the Swiss Franc’s safe-haven status.
Moreover, investors’ reluctance to place any aggressive bets ahead of the Fed Chair Jerome Powell’s scheduled speech at Jackson Hole on Friday could also be one of the key factors contributing to the lacklustre trading action.
Later during the early North-American session, the US economic docket – highlighting the release of flash manufacturing/services PMIs – will influence the USD price dynamics and will now be looked upon for some short-term trading opportunities.
Technical levels to watch
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