USD/CHF rallies beyond 100-DMA, 6-week tops

   “¢   Hawkish comments by Fed’s Evans help the USD to recover lost ground.
   “¢   Fading safe-haven demand seen weighing on CHF and remain supportive.
   “¢   Traders eye US ADP report and USM services PMI for some fresh impetus.

The USD/CHF pair continued gaining positive traction through the mid-European session and climbed to fresh six week tops, around the 0.9875-80 region in the last hour.

A combination of supporting factors helped the pair to catch some fresh bids on Wednesday, with bulls making it through and looking to build on the positive momentum further beyond 100-day SMA.  

A slight improvement in investors’ appetite for riskier assets was seen weighing on the Swiss Franc’s safe-haven status. This coupled with a modest US Dollar uptick, supported by hawkish comments by Chicago Fed President Charles Evans, provided an additional boost and lifted the pair to its highest level since August 21.

Speaking to Bloomberg TV, Evans said that he was comfortable with the idea of a December rate hike as the US economic fundamentals remain very strong and inflation data has improved significantly. The comments, against the backdrop of a goodish pickup in the US Treasury bond yields, helped the greenback to recover early lost ground and was seen driving the pair higher.

Moving ahead, today’s US economic docket, highlighting the release of ADP report on private sector employment, which followed by the ISM non-manufacturing PMI will now be looked upon for some fresh impetus during the early North-American session.

Technical levels to watch

The momentum seems strong enough to continue lifting the pair further towards reclaiming the 0.9900 handle ahead of the 0.9930 horizontal supply zone. On the flip side, retracement back below 100-day SMA, currently near the 0.9865 region now seems to find decent support near the 0.9835-30 region, which if broken might negate prospects for any further up-move.