- EUR/CHF extends the weekly rebound to the 1.0780 area.
- Persistent risk-on sentiment weighs on the safe haven CHF.
- US Industrial/Manufacturing Production, Fed’s Beige Book next on tap.
The generalized improvement in the risk complex is putting the safe haven universe under extra downside pressure and pushes EUR/CHF to fresh multi-week highs around 1.0780 on Wednesday.
EUR/CHF prints monthly tops
Following the drop to monthly lows in the 1.06 neighbourhood at the end of last week, EUR/CHF managed to regain composure and is now approaching the 1.0800 mark, up for the fourth session in a row so far.
Increasing inflows into the risk-associated space have been sustaining the nearly 2-cent recovery in the cross. In fact, optimism over a potential vaccine to finally eradicate the coronavirus pandemic plus hopes of a ‘V’-shaped recovery in the global economy have lifted the morale among investors, morphing into extra legs to stocks and other riskier assets.
In the docket, the US calendar deserves all the attention in light of releases of Industrial/Manufacturing Production figures, the NY Empire State index, Capacity Utilization and the Fed’s Beige Book.
Further out around the Swiss franc noted speculators added gross shorts to their CHF positions, taking the net longs to 2-week lows during the week ended on July 7 according to the latest CFTC Positioning Report.
EUR/CHF significant levels
As of writing the cross is gaining 0.63% at 1.0782 and a surpass of 1.0818 (23.6% Fibo of the May-June rally) would expose 1.0915 (2020 high Jun.5) and then 1.1033 (monthly high Dec.13 2019). On the other hand, the immediate support is located at 1.0735 (200-day SMA) ahead of 1.0644 (55-day SMA) and finally 1.0601 (monthly low Jul.10).
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