USD/CHF retreats from 1-1/2 week tops, refreshes session lows near 0.9765

The USD/CHF pair failed to sustain above the 0.9800 handle and has now reversed majority of its daily gains to 1-1/2 week highs.

The pair has failed to benefit from broad based US Dollar strength and is being weighed down by prevalent cautious sentiment surrounding global financial markets. The latest news report that Greece has threatened to opt out of £7.5bn debt repayments due in July, coupled with escalating geopolitical tension in the Korean peninsula, was seen supporting the Swiss Franc's safe-haven appeal.

Adding to this, a modest greenback pull-back from highs further collaborated to the pair's retracement back to the lower end of daily trading range, around 0.9770-65 region.

Meanwhile, traders shrugged off today's disappointing release of Swiss KOF Economic Barometer, retracing sharply to 101.6 for May as compared to previous month's 106.3 (revised higher from 106.0 reported earlier), with broader market risk-sentiment acting as an exclusive driver of the pair’s movement through early European session.

Later during the NA session, the US economic docket that includes - Core PCE Price Index, Personal Income / Spending data and Conference Board's Consumer Confidence Index, would now be looked upon to grab some short-term trading opportunities.

Technical levels to watch

A follow through retracement below 0.9760 level is likely to get extended towards back towards 0.9730-25 horizontal support, below which the pair is likely to turn vulnerable to break through multi-month lows support near the 0.9700-0.9690 region and head towards testing its next major support near mid-0.9600s. 

On the upside, the 0.9800 handle now becomes immediate strong resistance, which if conquered might trigger a short-covering rally towards 0.9820 intermediate barrier en-route 0.9850-55 strong horizontal resistance.