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USD/CHF advances higher toward 0.9700 an upbeat market mood

  • Major European equity indexes post decisive gains on Tuesday.
  • US Dollar Index clings to small gains near 97.90. 
  • Coming up: ISM-NY Business Conditions Index and IBD/TIPP Economic Optimism.

The USD/CHF pair closed the first day of the week with small gains and continued to push higher toward the 0.9700 mark on Tuesday supported by the upbeat market mood. As of writing, the pair was trading at 0.9687, adding 0.32% on a daily basis.

Risk-on flows dominate on Tuesday

Measures taken by Chinese authorities to help the economy shake off the negative impact of the coronavirus outbreak seem to be helping the risk sentiment improve. Major European equity indexes are all adding more than 1% on the day and the 10-year US Treasury bond yield is up 3.1%.

In the meantime, the US Dollar Index (DXY), which gained 0.5% on Monday on the back of strong Manufacturing PMI figures, is pushing higher to help the bullish momentum remain intact. 

Ahead of the ISM-NY Business Conditions Index and the IBD/TIPP Economic Optimism Index data from the US, the DXY is up 0.06% on a daily basis at 97.87.

Investors will be keeping a close eye on Wall Street's performance in the second half of the day and the pair could add to its gains if the risk appetite remains strong during the American trading hours.

Technical levels to watch for

 

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