- Once again fails to sustain above the parity mark and retreats from 1.0025-30 supply zone.
- The global flight to safety continues to benefit the CHF and exerted some downward pressure.
- Holds above 200-day SMA as bulls now eye US ISM non-manufacturing PMI for a fresh impetus.
The USD/CHF pair faded a knee-jerk bullish spike to over 2-1/2 month tops and quickly retreated around 40 pips during the early European session on Thursday.
The pair continued with its struggle to capitalize on the momentum beyond the parity mark and once again met with some fresh supply near the 1.0025-30 region. The prevailing risk-off mood continued underpinning demand for traditional safe-haven currencies, including the Swiss Franc (CHF) and exerted some fresh downward pressure on the major.
Risk-off mood continues to cap gains
The global flight to safety was further reinforced by the ongoing downfall in the US Treasury bond yields to the lowest level since September 9. This coupled with concern about slowing economic growth in the United States forced investors to start pricing in another interest rate cut by the Fed in October and kept the US Dollar bulls on the defensive.
It is worth recalling that data released on Tuesday showed that the US manufacturing sector activity recorded a sharp contraction in September. This was followed by the ADP report on Wednesday, which showed that the US private-sector employers added modest 135K jobs in the previous month and raised odds of further policy easing by the Fed.
Despite the pullback, the pair traded with a mild positive bias and has also managed to hold its neck above the very important 200-day SMA, warranting some caution for bearish traders and positioning for any meaningful depreciating move ahead of Friday's release of the closely watched US monthly jobs report - popularly known as NFP.
In the meantime, Thursday’s US economic docket - highlighting the release of ISM non-manufacturing PMI - will be looked upon for some short-term trading opportunities later during the early North-American session.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds gains near 1.0650 amid risk reset
EUR/USD is holding onto its recovery mode near 1.0650 in European trading on Friday. A recovery in risk sentiment is helping the pair, as the safe-haven US Dollar pares gains. Earlier today, reports of an Israeli strike inside Iran spooked markets.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD is rebounding toward 1.2450 in early Europe on Friday, having tested 1.2400 after the UK Retail Sales volumes stagnated again in March, The pair recovers in tandem with risk sentiment, as traders take account of the likely Israel's missile strikes on Iran.
Gold price defends gains below $2,400 as geopolitical risks linger
Gold price is trading below $2,400 in European trading on Friday, holding its retreat from a fresh five-day high of $2,418. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row, supported by lingering Middle East geopolitical risks.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Geopolitics once again take centre stage, as UK Retail Sales wither
Nearly a week to the day when Iran sent drones and missiles into Israel, Israel has retaliated and sent a missile into Iran. The initial reports caused a large uptick in the oil price.