The USD/CHF closed the previous week in the negative territory and continued to inch lower on Monday with the greenback struggling to find demand at the start of the week. As of writing, the pair was trading at 0.9828, erasing 0.1% on a daily basis.
The lack of clarity surrounding the details of the phase-one trade deal between the United States and China didn’t allow risk-on flows to dominate the market action on Friday. The fact that mutual tariff rollbacks depend on China’s agricultural imports from the US causes investors to remain cautious.
Nevertheless, the 10-year US Treasury bond yield is adding more than 1% on Monday and Wall Street’s main indexes look to start the day in the positive territory to suggest that the sentiment is improving.
Although a risk-positive market environment is likely to make it difficult for the safe-haven CHF to attract attention, the selling pressure surrounding the greenback could force the pair to remain stuck in its daily range.
At the moment, the US Dollar Index is down 0.21% on the day at 96.97. The IHS Markit’s preliminary Manufacturing PMI data is expected to come in at 52.6 to reveal ongoing expansion in the sector’s economic activity. An above-consensus reading could provide a boost to the USD and help the pair gain traction. The NAHB Housing Market Index and the IHS Markit Services PMI data will be featured in the US economic docket as well.
USD/CHF LONG (Buy)
ENTER AT: 0.98370