USD/CHF sticks to modest recovery gains, around mid-0.9600s

   •  A goodish USD rebound helps defend 0.96 handle.
   •  CHF further weighed down by the risk-on environment.
   •  US manufacturing data eyed for trading impetus.

The USD/CHF pair held on to its modest recovery gains and is currently placed near the top end of its daily trading range, around mid-0.9600s.

A goodish pickup in the US Dollar demand helped the pair to snap four consecutive days of losing streak and recover part of previous session's steep decline to the 0.9600 handle, near four-month lows. The uptick was further supported by the prevalent risk-on environment, which tends to weigh on the Swiss Franc's safe-haven appeal.

Moreover, near-term oversold conditions might have prompted bears to take some profits off the table, especially after the recent slump of nearly 250-pips over the past four days, and could also be one of the factors behind the pair's mildly positive tone. 

The up-move, however, lacked any strong conviction, or a follow-through momentum amid weaker US Treasury bond yields, which might continue to keep a lid on any meaningful recovery, at least for the time being.

Traders would now take cues from the release of Empire State Manufacturing Index, the only scheduled data due from today's relatively lighter US economic docket. 

Technical levels to watch

Immediate support is now pegged near 0.9625 level, below which the pair is likely to head back towards testing the 0.9600 handle before eventually dropping to its next support near the 0.9575-70 region.

On the upside, sustained move beyond 0.9675 level is likely to get extended towards the 0.9700 handle en-route 0.9730-35 supply zone.