USD/CHF consolidating strong gains to 9-1/2 month highs

Having jumped to 1.0200 neighborhood, the highest level since Feb. 3, the USD/CHF pair has retreated around 25-pips from session peak amid thin market liquidity on the back of Thanksgiving Day holiday in the US. 

Currently trading around 1.0170 region, nearly unchanged from previous session's closing level, the pair consolidated Wednesday's strong led by upbeat US economic data. The move got an additional boost from hawkish FOMC meeting minutes, which not only reinforced speculation for a December rate-hike but also seems to have fueled expectations that the Fed will keep tightening its monetary policy to prevent the economy from overheating.

The pair, however, failed to further extend the momentum as traders seemed inclined to take some profits off the table following post-US presidential election sharp up-move of around 650-pips. In fact, the overall US Dollar Index trimmed some of its early gains to 13-1/2 year highs and has now turned flat.

Moreover, today’s Swiss industrial production data, that showed a sharp rebound during the third-quarter of 2016, provided some respite for the Swiss Franc and might have also contributed to the pair’s retracement from multi-month highs. 

Technical levels to watch

Weakness below session low support near 1.0145 is likely to exert further selling pressure and drag the pair back towards previous resistance, now turned support, near 1.0120 area. Meanwhile on the upside, 1.0185 area now becomes immediate hurdle, which if cleared should now assist the pair to surpass 1.0200 handle and lift it towards its next major resistance near 1.0230 region.