USD/CHF trims gains, back around 50-DMA near 0.9730-40 band

Despite of the Friday's sharp up-move, the USD/CHF pair is finding difficulty in sustaining its strength above 100-day SMA. The pair has now trimmed its early Asian trading gains to currently trade around 50-day SMA region near 0.9730-40 band. 

On Friday, the US Dollar gained sharply against the Swiss Franc, reacting to the unexpected outcome of the crucial outcome of the historic Breixt referendum, with the USD/CHF pair surging to 0.9800 handle before retracing after SNB's statement on a possible intervention in the FX market. 

Monday, up-move was led by a fresh bout of safe-haven flows to the US Dollar after Moody's downgraded the outlook for the Aa1 British government debt from "stable" to "negative".  However, a slight improvement in investor sentiment now seems to diminish the safe-haven appeal for the greenback, forcing the USD/CHF pair to trim its gains.

From technical perspective, the pair has confirmed a break-out from near-term trading range and has also witnessed a strong follow through buying action and thus, increasing the prospects of further near-term appreciating move for the pair.

Technical levels to watch

From current levels, the pair needs to build on to its strength above 100-day SMA resistance around 0.9750-55 region, above which the pair seems to aim back towards reclaiming 0.9800 handle. Above 0.9800 handle, the pair seems more likely to extend its upward trajectory towards its next major resistance around 0.9860-65 region.

On the flip side, sustained weakness below 50-day SMA, leading to a break below 0.9700 round figure mark support, hs the potential to drag the pair back towards 0.9650 strong horizontal support, which if broken should take the pair back below 0.9600 handle.