USD/CHF advances to 10-day highs as DXY approaches 94
The USD/CHF pair extended its gains in the NA session to its highest level since July 17 at 0.9661. As of writing, the pair is trading at 0.9657, gaining 150 pips, or 1.57% on the day.
The greenback's steady recovery on Thursday carried the US Dollar Index closer to the 94 handle, allowing the index to erase all of its losses that it recorded yesterday after the July FOMC statement disappointed by not providing anything that could be seen as hawkish. At the moment, the DXY is at 93.90, up 0.65% on the day. Investors might also be looking to take some profits off the table ahead of tomorrow's preliminary Q2 GDP growth figures from the U.S., which is expected to improve to 2.6% from 1.4% in the first quarter.
Moreover, the fact that major equity indexes refreshed their record highs once again on Thursday amid robust earnings report from big corporations in the U.S., keep the risk-on mood alive, making the safe-havens like the CHF less desirable. Both the Dow Jones Industrial Average and S&P 500 indexes are at their peak levels, recording nearly 0.3% at the moment.
Technical outlook
The RSI on the daily graph surpasses the 50 mark and started to move towards the 70 threshold, suggesting that the bullish momentum is building up in the near-term. 0.9700 (psychological level/Jul. 14 high) could be seen as the first hurdle ahead of 0.9740 (Jun. 26 high) and 0.9785 (100-DMA). On the downside, supports align at 0.9600 (psychological level), 0.9590 (daily low) and 0.9490 (Jul. 26 low).
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
