USD/CHF struggles to recover above 0.97 post-US data

The USD/CHF pair came under a renewed selling pressure in the early NA session and eased to a fresh daily low at 0.9684 before starting to recover its losses. As of writing, the pair was trading at 0.9698, losing 0.05% on the day.

Today's data from the U.S. showed that annual inflation measured by the PCE price index increased 1.3%, its slowest pace in more than two years, while consumer spending rose 0.1% on a monthly basis in August after advancing 0.3% in July. Another data revealed that personal income grew by 0.2% in August. Although the official reports suggested that hurricanes Harvey and Irma were affecting the readings negatively, they also pointed out that it was hard to identify an exact amount of impact.

• US: Personal income increased $28.6 billion (0.2%) in August

With today's soft data, the US Dollar Index eased to a fresh 3-day low at 92.80 and was last seen at 92.92, where it was virtually unchanged on the day. The Chicago PMI Index and The UoM Consumer Sentiment Index will be coming up next in the session. However, investors could remain on the sidelines and allow the pair to consolidate as they are likely to refrain from taking large positions in the last trading day of the third quarter. 

In the meantime, major equity indexes in the U.S. started the day slightly lower, suggesting that there is no apparent risk-appetite in the markets, which could help the CHF remain resilient against the USD in the remainder of the session.

Technical outlook

The RSI indicator on the daily graph stays near the 50 handle, supporting the view of a short-term neutral outlook. The first resistance for the pair could be seen at 0.9800 (psychological level/May 29 high) ahead of 0.9850 (May 17 high) and 0.9935 (Apr. 23 high). On the downside, supports align at 0.9680 (daily low), 0.9635 (100-DMA/50-DMA) and 0.9565 (Sep. 15 low).