USD/CHF sticks to daily gains above 0.98 mark
- Markets started the week with an improved sentiment.
- Traditional safe-havens struggle to find demand on Monday.
- USD/CHF retraces Friday's losses as DXY stays above 93.
Following Friday's sharp losses, the USD/CHF pair opened the week with a 40-pip bullish gap and continued to push higher to refresh its daily peak at 0.9850 before going into a consolidation phase. As of writing, the pair was trading at 0.9833, adding 0.72% on the day.
USD receives a boost from tax bill news
The US Dollar Index, which plummeted to 92.56 on Friday amid political uneasiness in the United States, closed the week a little below the 93 mark and started the new week on a positive note. News of the Senate voting in favor of passing the tax bill helped the greenback gather strength against its peers. Moreover, Michael Flynn, Donald Trump's former national security adviser, who was said to testify against Trump after pleading guilty to lying to the FBI during the Russia probe, didn't provide any information that could be taken as unlawful action, allowing the risk appetite to return to the markets.
The only data scheduled to be released from the United States are the ISM NY Business Conditions Index and October Factory Orders. Although the data is unlikely to trigger any sharp fluctuations, a positive start by the major equity indexes in the United States could push the pair higher in the second half of the day.
Technical outlook
The pair could encounter the initial resistance at 0.9875 (50-DMA) ahead of 0.9945 (Nov. 21 high) and 1.0000 (psychological level). On the downside, supports align at 0.9800 (psychological level), 0.9750 (100-DMA/200-DMA) and 0.9700 (psychological level/Oct. 15 low).
USD/CHF down move seems terminated – Commerzbank