USD/CHF consolidates above 0.95 mark, awaits FOMC for fresh impetus

The USD/CHF pair traded with a positive bias for the third consecutive session and was seen building on previous session's strong gains beyond the key 0.95 psychological mark.

A modest greenback recovery, with the key US Dollar Index moving off 13-month lows remained supportive of the bid tone surrounding the major. Adding to this, the prevalent risk-on environment was also seen weighing on the Swiss Franc's safe-haven appeal and further collaborated to the pair's up-move to multi-day tops near 0.9530-35 region.

The up-move, however, seemed lacking conviction and strong follow through momentum as investors look forward to the outcome of the FOMC meeting. The Fed is widely expected to leave its monetary policy unchanged but the accompanying statement would be looked upon for clues over the monetary policy tightening path. 

Investors will be looking for signals on the timing of the start of the expected unwinding of the central bank's massive balance sheet and the timing of next rate hike action, which would eventually drive the greenback in the near-term and help determine the pair's next leg of directional move.

On the economic data front, the release of new home sales data from the US is likely to be overshadowed by repositioning trade ahead of the big event risk and hence, could turn out to be a non-event for the markets.

Technical levels to watch

Immediate resistance is seen near 0.9545-50 region, above which a fresh bout of short-covering could assist the pair to reclaim the 0.9600 handle and aim towards testing its next resistance near 0.9620-25 area.

On the flip side, the 0.95 handle now seems to act as an immediate support, which if broken could drag the pair back towards 0.9465 intermediate support ahead of multi-month lows near 0.9440-35 zone.