USD/CHF finds resistance above 0.9500 and pulls back to 0.9475 area

The USD/CHF rebound from 0.9420 its resistance at 0.9505 and pulls back.
The greenback trims gains as risk aversion eases and equities turn positive.
USD/CHF remains limited below downward trendline resistance from late-May highs.

Guillermo Alcala FXStreet

US dollar's recovery from Monday’s low at 0.9420 has run out of steam right above 0.9500 before giving away most of its daily gains during Thursday’s US session. The greenback is losing momentum with risk aversion easing and the major US equity markets turning into positive territory which has pulled the USD/CHF back to 0.9475 area.

US dollar trims gains as risk aversion eases

Market sentiment has improved moderately during the last session, as better than expected US data have eased fears of a second coronavirus wave. Orders for durable goods increased by 15.5% in May after a 17% slump over the previous month while the third estimate of the US GDP confirmed that the economy contracted at a 5% pace in the first three months of the year, in line with the market consensus.

US data has contributed to easing the negative market sentiment triggered by the global increase of COVID-19 infections which are dampening expectations of a V-shaped recovery and fueling demand for the USD due to its safe-haven status.

USD/CHF: Upside limited below trendline resistance at 0.9500

From a longer-term perspective, the daily chart shows the pair unable to break above the trendline resistance from late-May highs, now at 0.9505. On the downside, immediate support lies at 0.9475 (intra-day level and below here, 0.9420 (June 23 low) and 0.9375 (June 11 low).

Alternatively, above the mentioned 0.9005 level, the pair might ease downside pressure and aim towards 0.9555 (June 12, 15 highs) and 0.9645 (Jun 5 high and the 100-day SMA).

Author

Guillermo Alcala

FXStreet

Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.

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