USD/CHF struggles to rise above 0.96

The USD/CHF pair remains stuck in a tight 30-pip trading range on Monday amid a lack of fresh catalysts that could impact the price action. Following a failed attempt to stay above the 0.96 handle during the European morning, the pair lost its footing and is now trading at 0.9595, down 0.03% on the day.

Asian and European equity indexes are recording modest gains on Monday, making it difficult for the traditional safe-haven CHF to find demand and continue to go lower. Both the Dow Jones Industrial Average and the S&P 500 are signaling towards a positive opening to the session, which could help the pair rise above the 0.96 handle during the American trading hours.

Nevertheless, today's subdued trading action shows that the pair is making technical movements and it would be unlikely to see any sharp fluctuations in the remainder of the day with the economic calendar not offering any significant data. On Tuesday, after a quiet Asian session, ZEW is going to release its results for the Economic Sentiment survey for Germany and the euro area. However, it would be surprising to see a major reaction from the USD/CHF pair to these data.

Technical outlook

The RSI indicator on the daily graph is moving sideways near the 50 handle, supporting the view of a short-term neutral outlook for the pair. On the upside, the pair could encounter the first technical hurdle at 0.9615 (50-DMA) followed by 0.9700 (psychological level/Sep. 14 high) and 0.9765 (Aug. 16 high). On the flip side, supports align at 0.9570 (20-DMA), 0.9500 (psychological level) and 0.9420 (Sep. 8 low).

• USD/CHF constructive above 0.9530 – Commerzbank