USD/CHF hits new three-year highs above 1.0050

• The Swiss franc is weak at the start of the week.
• The dollar remains firm, with limited runs on Monday.
• USD/CHF overbought but without major signs of correction.

USD/CHF is higher on Monday, having closed Friday with the sixth weekly gain in a row. The pair climbed to 1.0057, the highest level since mid-May 2019. The pair then pulled back moderately, finding support at 1.0030 for now.

so far this day, USD/CHF traded above the parity level at all times and remains bullish, supported on Monday more by the weakness of the franc than by the strength of the dollar. The greenback is largely unchanged, holding on to recent gains. DXY falls 0.05% and trades at 104.40. Treasury bond yields are shown largely unchanged. The 10-year rate is 2.91% and the 30-year rate is 3.08%.

Swiss franc weakness is also reflected in EUR/CHF which hit as high as 1.0488, the highest since Wednesday and approaching May’s peak again, erasing last Thursday’s pullback. The rises of the cross on Monday are behind an increase in the yields of European bonds, especially after the comments of François Villeroy, a member of the Governing Council, who affirmed that a “decisive meeting in June” awaits him and a “ active summer.

Follow at high speed

The USD/CHF advance continues at a high speed, showing no signs of losing momentum. The case of a pullback to the 0.9975 area will be seen as a correction that can be followed by a bounce. Below this level appears the moving average of 55 in four hours at 0.9900/10, which can be taken as a reference: if this line is lost, a signal of a possible peak would be generated, at least in the short term. To the upside, USD/CHF may find resistance at 1.0080, followed by 1.0100.

Technical levels