“¢ Sliding US bond yields fail to assist the USD to build on the early positive momentum.
“¢ Risk-on mood weighs on CHF’s safe-haven appeal and might help limit downside.
The USD/CHF pair surrendered early gains to a session high level of 0.9968 and now seems headed back towards the lower end of its daily trading range.
The US Dollar struggled to build on its early positive momentum and was being capped by the ongoing slide in the US Treasury bond yields, which seemed to be the only factor behind the pair’s latest leg of downtick over the past hour or so.
However, the prevalent risk-on mood triggered by positive trade-related developments, dented demand for traditional safe-haven currencies, including the Swiss Franc, and might help limit any immediate sharp downside, at least for the time being.
Currently trading around mid-0.9900s, traders now look forward to Atlanta Fed President Raphael Bostic’s scheduled speech in order to grab some short-term opportunities amid absent market moving economic releases.
The key focus, however, would remain on the latest FOMC meeting minute and the Fed chair Jerome Powell’s speech at the Jackson Hole Symposium, which should assist investors to determine the pair’s next leg of directional move.
Technical levels to watch
Any subsequent fall is likely to find support near the 0.9930-25 zone and is followed by the 0.9900 handle, below which the pair could head back towards retesting 0.9870-65 support area.
On the flip side, the 0.9965-70 region remains an immediate strong hurdle, which if cleared should assist the pair to make a fresh attempt towards conquering the parity mark.
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