USD/CHF clings to modest gains; comfortable above 0.9700 mark
|- USD/CHF built on the overnight goodish bounce and gained some traction on Thursday.
- The USD remained well supported after Powell rejected the idea of negative interest rates.
- The cautious mood benefitted the safe-haven CHF and capped any strong gains for the pair.
The USD/CHF pair traded with a mild positive bias through the early European session, albeit lacked any strong follow-through buying and remained capped below weekly tops.
The pair edged higher on Thursday and built on the previous day's goodish intraday rebound of around 60 pips from the 0.9665 support zone, or one-week lows. The move-up came after the Fed Chair Jerome Powell rejected the idea of negative interest rates in the US, which helped revive the US dollar demand.
The greenback consolidated the overnight positive move and provide a modest lift to the major on Thursday. However, the cautious market mood – amid concerns about the second wave of coronavirus infections – benefitted the Swiss franc's safe-haven status and kept a lid on any further gains for the USD/CHF pair.
From a technical perspective, the pair has repeatedly faced rejection near the very important 200-day SMA. Meanwhile, the pullbacks have been able to attract decent dip-buying, which support prospects for additional gains. However, it will be prudent to wait for a sustained move beyond the 0.9800 mark to confirm the bullish bias.
The swissy was last seen trading near the 0.9725 region as market participants now look forward to the release of the US Initial Weekly Jobless Claims. The data might influence the USD price dynamics and produce some meaningful trading opportunities later during the early North American session.
Technical levels to watch
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