The USD/CHF pair continued gaining traction and built on previous session’s strong up-surge beyond the very important 200-day SMA.
Currently hovering around the parity mark, the pair traded with positive bias for the third consecutive session and jumped to near 3-week high during early European session on Tuesday. Persistent greenback buying interest, with the key US Dollar Index extending overnight gains beyond the 99.00 handle, on increasing odds for an eventual Fed rate-hike action in June, has been a key factor driving the pair higher.
Adding to this, positive trading sentiment around European equity markets and easing concerns over turmoil in the Euro-zone, following pro-EU candidate Emmanuel Macron’s victory in the closely watched French Presidential election, was seen weighing on the Swiss Franc’s safe-haven appeal and collaborated to the pair’s strong up-move to the highest level since April 18.
In absence of any fresh fundamental driver, the pair’s latest leg of up-move could also be attributed to a follow through short-covering following yesterday’s break through 0.9965-70 strong horizontal hurdle.
Today’s relatively thin US economic docket features the release of JOLTS job openings and would be looked upon for some trading impetus later during the NA session.
Technical levels to watch
Immediate resistance is pegged near 1.0020 level, above which the pair seems all set to dart towards 1.0050 hurdle before aiming to reclaim the 1.1000 psychological mark.
On the flip side, retracement back below resistance break area, now turned support near 0.9970 region, now seems to find fresh buying interest near 0.9950 region (200-day SMA). Any follow through weakness now seems to be limited and is likely to find strong support near 0.9935-30 horizontal level.