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USD/CHF eases from 1-week top, back below 0.9900 handle ahead of US data

  • A sharp slide in the US bond yields undermined the USD demand and capped gains.
  • The downside remains limited amid tempered expectations of aggressive Fed easing.

The USD/CHF pair spiked to one-week tops, levels beyond the 0.9900 handle in the last hour, albeit quickly retreated few pips thereafter.

The pair added to this week's modest gains and continued scaling higher for the third consecutive session on Wednesday, albeit a combination of factors kept a lid on any strong follow-through.

A fresh leg of a sharp downfall in the US Treasury bond yields failed to assist the US Dollar to build on the overnight goodish up-move - supported by upbeat US retail sales data and kept a lid on the up-move.

Adding to this, the prevalent cautious mood - amid resurfacing US-China trade tensions, extended some support to the Swiss Franc's safe-haven status and further collaborating towards capping the major.

The US President Donald Trump's latest threat to impose tariffs on an additional $325 billion worth of Chinese goods weighed on investors' sentiment and boosted demand for traditional safe-haven assets.

It would now be interesting to see if the pair is able to find any fresh buying at lower levels or witness some follow-through weakness as traders now look forward to the US housing market data for a fresh impetus.

Technical levels to watch

 

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