USD Holds Relatively Firm Versus The Majors

During most market selloffs, safe-haven assets perform well. This historical trend has proven false today, with the USD/CHF and USD/JPY trading relatively flat. In fact, the embattled Greenback has hung in there versus the majors. With only a few hours left in the forex session, the USD is holding on to rare gains vs the euro, GBP, and Canadian dollar.

It appears as though bad news out of Europe is the primary driver of bids toward the USD today. Eurozone Retail Sales (MoM, July) came in at -1.3%, well beneath projections (1.5%), and the previous release (5.3%). In addition, comments from France’s Macron suggest that 100 billion euros have been earmarked to stave off a COVID-19 economic catastrophe.

All in all, concerns over the Eurozone economic picture have favored the USD. Once again, it’s behaving moderately as a COVID-19 safe-haven ― a role relinquished in the past few months. If today’s action has taught us anything, it’s that investors remember all too well the risk asset shellacking of mid-March. Tomorrow is going to be a very interesting session for the majors going into the Labor Day weekend break.

USD Firms Up Vs The Majors

In a Live Market Update from Monday, I broke down the importance of the 0.9000 handle in the Swissy. Now, rates have once again rejected this support level and are headed north.

For the time being, there is one level on my radar for the USD/CHF:

• Support(1): Psyche Level, 0.9000

Bottom Line: Any time that a level is tested repeatedly and holds, it becomes an important technical area. And, if taken out, it can act as a catalyst for a breakout. Across the majors, there may be no level more scrutinized than 0.9000 in the USD/CHF.

Until elected, I’ll have sell orders in the queue from 0.8994. With an initial stop at 0.9054, this trade produces 60 pips on a standard 1:1 risk vs reward ratio.

ABOUT THE AUTHOR See More

Shain Vernier

US Analyst

Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.

Related Articles

Gold Price Weekly Forecast: Will XAU/USD Break $3,370 as US Jobs, GDP Loom?

2 days ago

Save

AUD/USD Rises on Tariff Talks—Triangle Squeeze Looms

3 days ago

Save

USOIL Breakout? WTI Crude Oil Eyes $64.80 Resistance

3 days ago

Save

Comments

0 0 votes

Article Rating

Subscribe

Login

Notify of

new follow-up commentsnew replies to my comments

Please login to comment

0 Comments

Oldest

Newest Most Voted

Inline Feedbacks

View all comments