USD/CHF Struggling Around 0.9700 Handle
Following a drop to its lowest level since May 12, the USD/CHF pair attempted a tepid recovery on Monday but now seems to struggle in extending its recovery decisively above 0.9700 handle.
After Friday's sharp slide of over 1.5%, the pair fell for second consecutive day on Monday before finding some support near 0.9680. The pair managed to bounce off Monday's low and is currently holding its neck just above 0.9700 handle. The pair on Monday gained on a broad safe-haven flow and remained a relative outperformer amongst other European majors.
A slew of disappointment from recent US economic releases has dashed expectations of a Fed rate-hike in June and possibly for July as well. Hence, the Swiss Franc might continue to remain a key beneficiary of the broader USD weakness, exerting further downward pressure on the the USD/CHF pair.
Technical levels to watch
On the immediate upside, 50-day SMA support break-point near 0.9720 region now seems to act as immediate resistance, which if taken out seems to assist the pair further towards 0.9760 resistance zone. Meanwhile on the downside, traders will keep a close watch on Monday lows support near 0.9680, which if broken might trigger another leg of weakening trend for the pair. Below 0.9680, the pair seems to drop immediately towards 0.9650 support before heading towards its next major support near 0.9615-0.9600 region.