USD/CHF surrenders early gains to 1-week tops, still comfortably above 0.9700
|- USD/CHF gained some intraday traction amid the upbeat market mood.
- Worsening US-China relations capped gains amid relatively thin liquidity.
- A subdued USD price action did little to provide any meaningful impetus.
The USD/CHF pair struggled to capitalize on its early uptick to one-week tops and now seemed headed back to the lower end of its daily trading range.
The pair built on last week's goodish bounce from the 0.9640-35 region and gained some follow-through traction on the first day of a new trading week. The intraday positive move for the third consecutive session was supported by the upbeat market mood, which tends to undermine the Swiss franc's safe-haven demand.
Bulls, however, refrained from placing any aggressive bets amid worsening US-China relations. China formally tabled national security laws for both Hong Kong and Macau. This comes the US President Donald Trump threatened to take strong action if the law is passed and fueled worries about a major US-China tussle.
Meanwhile, the US dollar witnessed a subdued/range-bound trading action through the early part of Monday's trading action. This, in turn, did little to provide any meaningful impetus to the USD/CHF pair and led to a modest intraday pullback of around 20-pips from the vicinity of the 0.9730-50 heavy supply zone.
Given that the US banks will be closed in observance of Memorial Day, relatively thin liquidity conditions further warrant some caution before placing fresh bets. Hence, it will be prudent to wait for some strong follow-through buying before bulls make a fresh attempt to retest the 200-day SMA barrier near the 0.9780 region.
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.