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  • Wall Street starts retracing yesterday’s losses on Tuesday.
  • The US Dollar Index extends its upside toward mid-94s.

On Tuesday, the USD/CHF pair was able to extend its steady recovery, which started in the European morning, into the NA session as the greenback continues to stay strong against its rivals. As of writing, the pair was trading at 0.9916, adding 0.45% on the day.

Today’s data from the United States helped the USD gather strength in the second half of the day. The Manufacturing Index released by the Federal Reserve Bank of Richmond improved to 20 in June from 16 in May to beat the market expectation of 15. Furthermore, home prices stayed in their recent uptrend with the S&P/Case-Shiller Home Price Index showing an annual increase of 6.6% in April. The US Dollar Index recently touched its daily high at 94.46 and was last seen at 94.40, where it was up 0.47% on the day.

On the other hand, the CHF is having a hard time finding demand as a safe-haven with the market sentiment improving on Tuesday. The CBOE Volatility Index, Wall Street’s fear gauge, rose as much as 40% yesterday and is now down 12%. Meanwhile, after starting the day slightly higher, major equity indexes in the United States gained traction with the Dow Jones Industrial Average and the S&P 500 both adding nearly 0.5% at the moment.

There won’t be any other macroeconomic releases in the remainder of the day and the DXY is likely to continue to drive the pair’s price action.

Technical levels to consider

1.0000 (parity/psychological level) remains as a critical resistance for the pair ahead of 1.0055 (May 9 high) and 1.0100 (May. 11, 2017, high). On the downside, supports are located at 0.9840 (Jun. 13 low), 0.9790 (Jun. 7 low) and 0.9700 (psychological level).