- USD/CHF stage modest recovery from a fresh monthly low touched earlier this Friday.
- The risk-on impulse undermined the safe-haven CHF and acted as a tailwind to the pair.
- Rebounding US bond yields helped revive the USD demand and remained supportive.
- Recession fears held back bulls from placing aggressive bets and might cap the upside.
The USD/CHF pair traded with a mild positive bias through the early North American session and was last seen hovering near the daily peak, around the 0.9740-0.9745 region.
Having shown some resilience below the 0.9700 mark, the USD/CHF pair staged modest bounce from a fresh monthly low touched earlier this Friday amid the risk-on impulse. The market sentiment got a boost after the People’s Bank of China (PBOC) cut its five-year loan prime rate by 15 basis points to counter an economic slowdown. This was evident from the strong recovery in the equity markets, which undermined the safe-haven Swiss franc and acted as a tailwind for the major.
On the other hand, the US dollar drew some support from rebounding US Treasury bond yields and the prospects for a more aggressive policy tightening by the Fed. This was seen as another factor that contributed to the USD/CHF pair's intraday recovery of over 50 pips. That said, concerns about softening global economic growth kept a lid on the optimism and held back bulls from placing aggressive bets amid absent relevant market-moving economic release from the US.
The markets remain worried that a more aggressive move by major central banks to constrain inflation could pose challenges to global economic growth. Apart from this, the Russia-Ukraine war and extended COVID-19 lockdowns in China have been fueling recession fears. This might continue to drive some haven flows, making it prudent to wait for strong follow-through buying before confirming that the USD/CHF pair has formed a near-term bottom and positioning for any further gains.
Technical levels to watch
|Today last price||0.9739|
|Today Daily Change||0.0008|
|Today Daily Change %||0.08|
|Today daily open||0.9731|
|Previous Daily High||0.9897|
|Previous Daily Low||0.9697|
|Previous Weekly High||1.0049|
|Previous Weekly Low||0.9872|
|Previous Monthly High||0.9759|
|Previous Monthly Low||0.9221|
|Daily Fibonacci 38.2%||0.9773|
|Daily Fibonacci 61.8%||0.9821|
|Daily Pivot Point S1||0.9653|
|Daily Pivot Point S2||0.9575|
|Daily Pivot Point S3||0.9454|
|Daily Pivot Point R1||0.9853|
|Daily Pivot Point R2||0.9975|
|Daily Pivot Point R3||1.0053|
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