USD/CHF corrects daily losses as USD catches fresh bids

Although it started the week with a bearish gap, the USD/CHF has been able to erase its losses on Monday, before coming back under pressure on Tuesday. After dropping to a fresh session low at 0.9918, the pair started to consolidate its losses and is now trading at 0.9935, down 0.23% on the day.

Although other traditional safe havens, such as the JPY and Gold, continued to suffer losses against their rivals on Tuesday, the CHF has been able to take advantage of the weak greenback, supported by a general bid tone surrounding the European currencies.

After falling to a new five-month low at 99.57, the US Dollar Index was able to correct towards 99.70, limiting the losses of the USD/CHF pair for the time being. As of writing, the DXY was down 0.23%, at 98.68. The risk appetite could also be seen as a factor that helps the pair find support. The Dow Jones Industrial Average is rising more than 1% for the second day in a row while the S&P 500 is up 0.7% on Tuesday.

Technical outlook

The initial hurdle for the pair could be seen at 0.9980 (200-DMA) ahead of 1.0000 (psychological level) and 1.0035 (100-DMA). To the downside, supports could be encountered at 0.9915 (daily low/), 0.9875 (Mar. 26 low) and 0.9810 (Mar. 27 low).

• USD/CHF focused on 1.0072 as long as 0.9850 holds – Commerzbank