USD/CHF stabilizes close to 1.0010 amid USD profit-taking

• The US dollar is booming higher on Tuesday on the back of rising Treasury yields.
• The Swissy tests the 1.0040 level then retreats to the 1.0010 region amid mild USD profit-taking.
• The US Dollar Index has tested last week’s high and is now consolidating in the 93.15 region.

The USD/CHF pair is trading at around 1.0010 virtually unchanged on Tuesday.

The USD/CHF pair rose from the parity level in the Asian session and found an intraday ceiling at the 1.0040 level in the first part of the American session. The Swissy is now retreating to the 1.0010 region on the back of a mild USD profit-taking.

On Monday, the greenback got a strong boost across the board as the bond yields market is rising. The 10-year Treasury yield benchmark is trading in the 3.060% area which are levels not seen since the summer of 2011. 

Meanwhile, the US Dollar Index, which measures the greenback against a basket of currencies is also booming higher and tested last week’s high at 93.42 and is currently consolidating in the 93.15 region at the time of writing. 

Investors are getting rid of risky assets such as US stocks and bonds and are turning to cash. The current strong USD demand is fueled by the expectations that the Federal Reserve Bank will raise rates three to four times in 2018. 

USD/CHF 4-hour chart 

The main trend is bullish and immediate resistance is seen at the 1.0040 level, high of the day, followed by 1.0059, high of the year. To the downside, bears will likely meet resistance at the parity level and at 0.9957 swing low. The Swissy is trading above its 100 and 200-period simple moving average (4-hour chart) but below the 50-period simple moving average suggesting a mild slowing bullish momentum.