USD/CHF moves beyond mid-0.9700s, near 1-week tops amid notable USD demand
- USD/CHF gains traction for the third consecutive session on Wednesday.
- A US-China spat boosted the USD’s status as the global reserve currency.
- The risk-on mood weighed on the safe-haven CHF and remained supportive.
The USD buying interest picked up pace in the last hour and lifted the USD/CHF pair to near one-week tops, around the 0.9755-60 region in the last hour.
A combination of supporting factors assisted the pair to gain some follow-through traction for the third consecutive session on Wednesday and build on its recent bounce from sub-0.9600 levels, or one-month lows set on May 1st.
The greenback continued benefitting from its status as the global reserve currency amid worsening US-China relations over the origin of the coronavirus and was further supported by some heavy selling around its European counterparts.
Meanwhile, the latest optimism over the re-opening of economies in some parts of the world was evident from a positive mood around the global equity markets. This, in turn, undermined the Swiss franc's safe-haven demand and remained supportive.
It will now be interesting to see if the pair is able to capitalize on the momentum or continues with its struggle to make it through the very important 200-day SMA barrier, just ahead of the 0.9800 round-figure mark.
Moving ahead, Wednesday's US economic docket highlights the release of the ADP report on private-sector employment, which might influence the USD price dynamics and provide some impetus later during the early North-American session.
Technical levels to watch