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  • US dollar outperforms during US session after data.  
  • Swiss franc retreat but still among top performers of the day.  

The USD/CHF pair rebounded during the US session supported by a rally of the US dollar across the board. It climbed from 0.9925 (lowest since February 1) to 0.9995 and then pulled back modestly. It was trading at 0.9970, 40 pips below yesterday’s close but far from the lows.  

The Swiss franc is among the top performers despite the rally of the dollar. The greenback gained momentum after the release of US GDP Q4 numbers that came in above expectations. “GDP for Q4 came in at 2.6 % q/q annualized, indicating some slowing of growth as expected. Going forward, visibility of the GDP numbers will be hampered by the government shutdown and other information sources are needed to gauge underlying trend”, said Kjetil Olsen, macro-economist at Nordea. Also the Chicago PMI report (best reading in 14 months) favored the greenback.  

The DXY bounced from weekly lows near 95.80 back above 96.00. It reached 96.28 before turning flat for the day at 96.10/15. A main driver behind the dollar’s strength was the upsurge in US bond yields. The 10-year rose to 2.72% , highest intraday level since February 5.  

Levels to watch  

The USD/CHF chart still pint to the downside, particularly with the pair unable to recover levels above 0.9985. Although the bounce of the US dollar took the momentum out of the Swiss franc. The critical level to the upside is seen around 1.0015/20, the weekly high and also the 20-day moving average: a break higher would clear the way to more gains. To the downside, support levels might lie at 0.9950, 0.9925/30 (Feb 28 low) and 0.9900.