- Bulls shrug off a subdued USD demand and the prevailing risk-off mood.
- The upside is likely to be capped near ascending trend-channel resistance.
The USD/CHF pair built on the overnight goodish intraday up-move and continued gaining positive traction for the second consecutive session to hit fresh multi-week tops during the early North-American session on Tuesday.
The intraday bullish momentum helped the pair to move beyond the very important 200-day SMA, which should now be seen as a key trigger for bullish traders and sets the stage for an extension of the appreciating move.
Looking at the broader picture, the pair remains well within a six-week-old ascending trend-channel formation. This coupled with bullish technical indicators on hourly/daily charts further add credence to the constructive outlook.
However, the recent escalation of geopolitical tensions, which tend to underpin demand for perceived safe-haven currencies like the Swiss Franc, warrant some caution for bullish traders amid a weaker tone surrounding the USD.
Hence, any subsequent up-move is likely to confront a stiff resistance near the top end of the mentioned ascending trend-channel, around the parity mark, which should cap the upside ahead of the highly anticipated FOMC decision.
On the flip side, immediate support is pegged near the 0.9925 horizontal level ahead of the 0.9900 handle, which if broken now seems to accelerate the fall further towards trend-channel support, currently near mid-0.9800s.
USD/CHF daily chart