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USD/CHF turns positive above the 0.98 mark on DXY recovery

  • USD/CHF recovers from monthly lows in the NA session.
  • US stocks are mixed on the first day of the week.
  • US Dollar Index retraces daily losses on robust data.

After plummeting to its lowest level since October 20 at 0.9777, the USD/CHF pair gained traction in the early NA session and rose above the 0.98 handle to refresh its session high at 0.9818 before going into consolidation. As of writing, the pair was trading at 0.9812, gaining 15 pips on the day.

New home sales in the U.S. rose to a 10-year high in October

According to the data released by the U.S. Census Bureau and the Department of Housing and Urban Development, sales of new single-family homes advanced to a seasonally adjusted annual rate of 685,000 in October, the highest level since October 2007. The US Dollar Index, which plummeted below the mid-92s ahead of the data, gathered momentum and erased its daily losses, fueling the pair's recovery. At the moment, the index is at 92.80, up 0.06% on the day. However, unless the index makes a daily close above the 93 mark, the index could have a difficult time rising decisively.

On the other hand, major equity indexes in the U.S. are painting a mixed picture of the market sentiment with the Dow Jones Industrial Average rising 0.12% while the S&P 500 is dropping 0.05% at the moment. Developments surrounding the tax bill this week are likely to be the next major catalyst for Wall Street.

Later in the session, FOMC members Neel Kashkari and William Dudley will be delivering their speeches. Tuesday's macroeconomic calendar will be featuring the wholesale inventories and goods trade balance from the United States.

Technical levels to watch

The pair could encounter the first technical support at 0.9750 (100-DMA/200-DMA) ahead of 0.9700 (psychological level(Oct. 15 low) and 0.9645 (Sep. 25 low). On the upside, resistances align at 0.9860 (50-DMA), 0.9945 (Nov. 21 high) and 1.0000 (psychological level). 


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