USD/CHF struggles to gather enough momentum to test parity

• Market sentiment turns neutral on Tuesday, European stocks trade mixed.
• US Dollar Index fluctuates in tight range above 98.
• CB Consumer Confidence Index and New Home Sales data will be released from US.

The USD/CHF pair rose to a fresh daily top of 0.9987 in the early trading hours of the European session but failed to preserve its momentum as investors refrain from taking large positions while waiting for new developments on the US-China trade dispute. As of writing, the pair was up 0.07% on the day at 0.9970.

According to the Chinese news outlet Global Times,  China’s Vice Premier Liu He held a phone call  with US Trade Representative Lighthizer and US Treasury Secretary Mnuchin on Tuesday to discuss  tariff removal, agricultural purchases and a review mechanism for the implementation of a potential agreement.

Despite this development, major European equity indexes are trading mixed on Tuesday and the 10-year US Treasury bond yield is posting modest losses to reveal that the market sentiment remains neutral so far. Additionally, the S&P 500 futures trade flat on the day to suggest that Wall Street’s main indexes are likely to start the day unchanged.

USD stays quiet ahead of mid-tier US data

In the second half of the day, the Conference Board’s (CB) Consumer Confidence Index, Goods Trade Balance and New Home Sales data from the US will be watched closely by the market participants. Meanwhile,  the US Dollar Index is registering small daily gains at 98.32.  

Previewing the CB data, TD Securities analysts note that the Confidence Index is expected to improve to 127 in November from 125.9 in October.  “If confirmed, the Conference Board’s measure would remain at healthy levels, which would be positive for the prospects of private spending,” analysts added.  

Technical levels to watch for