- The USD / CHF has moved with a slight positive bias during the first half of the European session.
- The rally has lacked a solid following amid a softer tone around the USD.
- A sustained move above 0.9160-65 is needed to confirm any further bullish movement.
At the start of the European session, the pair USD/CHF It has moved to the 0.9160 region, at the upper end of its weekly range, although it has lacked a solid continuation buy. At the time of writing, the pair has returned initial gains and remains virtually unchanged on the day near 0.9140-45.
The pair has struggled to capitalize on its good recovery from the 0.9085 region, a four-week lows, and has been consolidating within a range for the last three trading days. The stagnation of the next round of US fiscal stimulus measures has prevented USD bulls from opening aggressive positions. This, in turn, has been considered a key factor that has limited the gains of the USD / CHF pair.
In the meantime, decline appears supported near 50-day simple moving average amid new nerves from coronavirus, which continues to provide some support to the US dollar as a global reserve currency. Investors remain concerned that a sharp increase in New cases of coronavirus could lead to new lockdown measures and hamper the global economic recovery.
From a technical perspective, the recent price action within the range warrants some caution before positioning aggressively. However, the fact that the USD / CHF pair found acceptance above the 50-day SMA favors the bulls and supports the prospects for additional earnings. However, the bulls may need to wait for some buying above the 0.9160-65 region before positioning for any further upward movement towards the 0.9200 round level.
Market participants now await release of US monthly retail sales figures Friday’s US economic calendar also features industrial production data and preliminary estimate of the University of Michigan consumer sentiment index for October . This, coupled with broader market risk sentiment, could generate some short-term trading opportunities around the USD / CHF pair.
Credits: Forex Street
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