- USD/CHF gained some traction and built on the overnight bounce from three-month lows.
- The risk-on mood undermined the safe-haven CHF and remained supportive of the uptick.
- A subdued USD price action held back aggressive bullish traders and might cap the upside.
The USD/CHF pair broke out of its daily consolidative range and jumped to fresh session tops, around the 0.9475 region in the last hour.
The pair managed to gain some positive traction on the last trading day of the week and built on the previous session’s goodish intraday bounce of around 65 pips from three-month lows. The upbeat market mood undermined the safe-haven Swiss franc and was seen as one of the key factors lending some support to the USD/CHF pair.
Despite renewed fears over a second wave of coronavirus infections and the Fed’s gloomy outlook, investors seemed convinced about the prospects of a sharp V-shaped economic recovery. The confidence was evident from a fresh leg up across the global equity market and dented demand for traditional safe-haven currencies.
Meanwhile, the US dollar struggled to capitalize on the overnight strong intraday positive move. A subdued USD demand might hold investors from placing aggressive bullish bets and cap the upside for the USD/CHF pair. Hence, it will be prudent to wait for some strong follow-through buying before confirming that the pair might have bottomed out.
Moving ahead, market participants now look forward to the release of the preliminary June Michigan Consumer Sentiment Index from the US. The data, along with the broader market risk sentiment might influence the USD price dynamics and produce some trading opportunities later during the early North American session.
Technical levels to watch
Share
