USD/CHF preserves daily gains above 0.96

After plummeting to its daily low around mid-0.95s with the initial reaction to the dismal employment data from the United States, the USD/CHF easily retraced its losses and rose back above the 0.96 handle. As of writing, the pair was trading at 0.9617, up 0.28% on the day.

According to the data released by the U.S. Bureau of Labor Statistics, total nonfarm employment rose by 156,000, failing to meet the market consensus of 180,000. Moreover, the July reading of 209,000 got revised down to 189,000 while the unemployment rate ticked up to 4.4% in August from 4.3% in July. Although the US Dollar Index quickly dropped to 92.06 minutes after the data release, it didn't have a difficult time recovering its losses. Later in the session, manufacturing PMI data issued by the ISM and the Markit, which are seen as leading indicators, both surpassed the market estimates, with employment sub-indexes recording robust gains and allowing the greenback to gather strength against its peers.

• US: Total nonfarm payroll employment increased by 156,000 in August
• US: Manufacturing output expands at weakest pace since June 2016 - Markit
• US: Economic activity in the manufacturing sector expanded in August - ISM

Moreover, during the NA session, Thomas J. Jordan, the chairman of the governing board of the Swiss National Bank, crossed the wires saying that the end of the expansive monetary policy wasn't even a topic. With today's gains, the pair is looking to close the week with modestly higher. On Monday, the US markets will be closed due to the Labor Day holiday, and the pair is likely to remain in tight trading ranges in the near-term.

Technical outlook

The pair could face the first technical resistance at 0.9680 (100-DMA) ahead of 0.9765 (Aug.16 high) and 0.9800 (psychological level). On the flip side, supports could be seen at 0.9585 (Aug. 18 low), 0.9500 (psychological level) and 0.9440 (Jul. 21 low). On the daily graph, the RSI indicator continues to move sideways around the 50 handle, suggesting that the pair is struggling to set a near-term direction.