For the second day in a row, the USD/CHF gained traction and moved away from one-month lows.
The safe-haven CHF was underpinned by signs of calm in the equities markets, which remained favorable.
A sluggish USD price action ahead of the US Retail Sales report may keep any additional advances at bay.
During the first half of the European session, the USD/CHF pair soared to over one-week highs, with bulls now trying to extend the rally beyond the 0.9200 level.
The pair gained traction for the second straight session on Friday, building on the previous day’s goodish rebound from the 0.9120-15 zone, or near one-month lows. The increase could be due to some follow-through short-covering amid evidence of equities market stability, which tends to dampen demand for the safe-haven Swiss franc.
The US dollar, on the other hand, was observed swinging in a small trading area and failing to provide the USD/CHF pair a boost. However, the greenback continues to benefit from a sharp rise in US Treasury bond yields, as well as predictions that the Fed may tighten its monetary policy sooner than expected.
Market players are now anticipating the publication of monthly Retail Sales numbers from the United States. This, combined with US bond yields, might impact USD price dynamics and provide the USD/CHF pair a boost. Traders will also look for short-term opportunities based on the larger market risk perception.
From a technical standpoint, prolonged strength over the 0.9200 level might serve as a new trigger for optimistic traders, paving the way for more rises. The USD/CHF pair could then try to retest monthly swing highs above 0.9275, with some intermediate resistance near 0.9230-35./n
