The USD/CHF pair surged to highs not seen since mid-June, reaching the crucial 100-day SMA at 0.8975. The strength of the USD remained strong, driven by elevated Treasury yields. The market still predicts a 60% chance of a Fed rate cut in September.
On Wednesday, the USD/CHF pair benefited from rising US Treasury yields and ignored soft housing data. The Swiss economic calendar was quiet, leaving the pair influenced by broader market trends and US data.
New Home Sales figures for May disappointed, with sales dropping to 619K units, a significant decrease from the previous 698K units. Despite this, US Treasury yields remained high, making the USD attractive.
Although the market anticipates a Fed rate cut in September, Federal Reserve officials have hinted at only one cut in 2024. Economic events to watch include the GDP revisions for Q1 and the May PCE report.
Technically, the USD/CHF pair looks positive, trading above the 20-day and 200-day SMA. It is aiming to break above the 100-day average, which could strengthen its outlook. The RSI and MACD indicators also support a positive trend.
Overall, the USD/CHF pair is showing strength and potential for further gains.