USD/CHF trades near 12-day lows below parity
|- US Dollar Index struggles to recover above 96.50.
- Risk-off mood helps CHF find demand.
- Coming up: NAHB Housing Market Index.
The USD/CHF pair started the week in a calm manner near the parity level and lost its traction in the European morning. After dropping to its lowest level since November 7 at 0.9958, the pair recovered a small part of its daily losses and was last seen trading at 0.9970, where it was down 0.3% on a daily basis.
Amid a lack of significant macroeconomic data releases on Monday, political developments in the UK stay under the spotlight. The uncertainty over the British Parliament's support for Prime Minister Theresa May's Brexit plan and the possibility of a no-confidence vote weighs on the market sentiment and helps traditional safe-havens such as the CHF gather strength against its rivals.
Additionally, the greenback stays weak today following some cautious remarks from Fed officials last Friday. The US Dollar Index, which closed the previous week on a weak note, was last down 0.05% on the day at 96.40. Later in the day, the NAHB will publish its housing market report and New York Fed President Williams will be delivering a speech.
Technical levels to consider
The initial support for the pair aligns at 0.9940 (50-DMA) ahead of 0.9875 (100-DMA/200-DMA) and 0.9800 (Sep. 30 low). On the upside, resistances are located at 1.0000 (psychological level/parity), 1.0035 (20-DMA) and 1.0085 (nov. 16 low).
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