U.S. Indices Open The Week In The Green

It has been an active open to the U.S. trading week. Bulls have shown interest in the equity markets this morning, bidding U.S. indices higher in the wake of a vacant economic calendar. At least for the moment, it appears both the DJIA and S&P 500 are preparing for a late-summer return to all-time highs.

Dull Mondays have been the pattern for the last month or so in the U.S. indices. This has not been the case today, with many of the blue-chip stocks experiencing heavy action. On the forex front, the USD is having a tough session across the majors. While there have been no catastrophic losses, weakness against the Japanese yen and Swiss franc are signs of investor caution toward the Greenback.

USD/CHF Technicals

Today’s drop in the USD/CHF has set up an interesting scenario for the remainder of the week. Price has rejected a key level of support on the daily chart. For now, it looks as though today’s close may set up a coming breakout in the USD/CHF.

Here are the key levels to watch for the remainder of the session:

• Resistance(1): Bollinger MP, .9943
• Support(1): Daily SMA, .9932

Overview: After an early test of support at the Daily SMA (.9932), price has slowed considerably in the .9940-30 area. In the event we see the Daily SMA hold up as the intrasession low, then a breakout above .9950 or below .9925 may set up for later in the week.

All in all, the USD/CHF is currently an extremely tight market. With a wide-open economic calendar until Wednesday’s FOMC Minutes, we may be in for a period of extended consolidation before the break. However, this week’s FOMC release will be one of the more scrutinized in recent memory. It may act as the catalyst for driving the USD/CHF directionally.