USD/CHF turns flat near 0.9940 ahead of US data
|- US Dollar Index consolidates daily losses above 96.50.
- European indices rebound modestly.
The USD/CHF pair eased below the 0.9920 during the early European morning as the CHF struggled to find demand as a safe-haven in the risk-on environment. However, with the greenback continuing to retrace its recent gains, the pair recovered its losses and was last seen trading at 0.9940, where it was virtually unchanged on the day.
Yesterday, major equity indices in Europe suffered heavy losses on escalating geopolitical tensions. Germany's DAX and the UK's FTSE, which both fell around 1.5% on Wednesday, were last seen up 0.3% and 0.7% on the day respectively, reflecting the improved market sentiment. Meanwhile, after failing to break above the critical 97 mark yesterday, the US Dollar Index finally began its overdue correction and was last seen down 0.11% on the day at 96.60.
Later in the session, Philly Fed Manufacturing Index, housing starts & building permits, and the weekly initial jobless claims will be featured in the American economic docket.
Technical outlook
Despite today's price action, the pair is still having a hard time determining its next short-term direction with the RSI indicator on the daily chart moving sideways near the 50 mark. On the downside, supports could be seen at 0.9925 (100-DMA), 0.9865 (Jul. 31 low) and 0.9830 (Jun. 5 low). Resistances align at 1.0000 (parity level), 1.0065 (Jul. 13 high) and 1.0100 (psychological level).
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