USD/CHF Price Analysis: Gains but falls short of parity at around 0.9960s

The USD/CHF retreated from YTD highs around 0.9960s as traders got ready to launch an assault toward the parity, but a negative market mood and USD traders booking profits were the main reason that kept the USD/CHF around the 0.9900 mark. At the time of writing, the USD/CHF is trading at 0.9932.

Monday’s main theme has been higher US Treasury yields, as the 10-year benchmark note struck a four-year high in the last week, though as of writing sits at 3.075%. Furthermore, China’s exports slowed to single digits, the weakest in almost two years, as tighter and wider coronavirus curbs halted factory production and hurt domestic demand, adding to broader economic woes.

On Monday, the USD/CHF opened in the Asian session below the 0.9900 mark, but market sentiment increased appetite for the greenback, which pushed above the R2 daily pivot at 0.9930, just shy of the R3 pivot point at around 0.9970.

USD/CHF Price Forecast: Technical outlook

The USD/CHF daily chart maintains the pair as upward biased, though USD/CHF traders taking profits caused a slight dip toward 0.9930s. The Relative Strength Index (RSI), around 82.29, aims slightly down, which could eventually confirm a negative divergence between RSI and price action.

The USD/CHF first support would be 0.9900. Break below would expose essential demand levels, like April 2020 swing high at around 0.9802, followed by 0.9700. Upwards, the major’s first resistance would be, May 9 daily high at 0.9965. A breach of the latter would expose the parity.