USD/CHF: Post-NFP spike falters ahead of 0.9900 handle
|- Mostly upbeat US employment details provided a modest lift to the USD.
- Positive US bond yields, improving risk sentiment remained supportive.
- The uptick lacked any strong follow-through, warranting some caution.
The USD/CHF pair spiked to fresh session tops, closer to the 0.9900 handle in reaction to upbeat headline NFP print, albeit quickly retreated few pips thereafter.
The pair stalled this week's pullback from levels just above the very important 200-day SMA and managed to attract some buying interest just ahead of mid-0.9800s. The intraday uptick got an additional boost in the wake of a sudden pick up in the US Dollar demand following the release of the latest US monthly jobs report.
Bulls lacking conviction
Data released this Friday showed that the US economy added 128K new jobs in October and surpassed the most optimistic estimates. Adding to this, the previous month's reading was also revised higher to 180K as compared to 136 reported earlier and provided a modest intraday lift to the Greenback.
Meanwhile, the unemployment rate edged up to 3.6% from a 50-year low of 3.5% and average hourly earnings climbed 3% from a year earlier, matching projections, and the previous month's upwardly revised reading, and offsetting slightly below estimate 0.2% monthly gains.
This coupled with a modest pickup in the US Treasury bond yields extended some additional support to the USD, while a recovery in the risk sentiment undermined demand for traditional safe-haven currencies, including the Swiss Franc, though bulls lacked any strong conviction.
Hence, it will be prudent to wait for some strong follow-through buying before confirming that the recent corrective slide is over and positioning for a move back towards challenging the 0.9945-50 supply zone.
Technical levels to watch
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