USD/CHF struggles to defend two-day winning streak around 0.9100 as full markets return

• USD/CHF fades upside momentum after rising in the last two consecutive days.
• US Dollar bulls seek more clues to extend four-day uptrend near one-week high.
• Friday’s upbeat NFP favored hawkish Fed bets and favored US Dollar of late, risk aversion also strengthened the greenback.
• Return of full markets, cautious mood ahead of top-tier data/events test Swiss pair traders.

USD/CHF retreats to 0.9090 during early Tuesday, snapping a two-day uptrend, as bulls turn cautious on full markets’ return after Good Friday and Easter Monday holidays. Also acting as an upside barrier for the Swiss Franc pair are the fresh doubts on the Federal Reserve’s (Fed) May month rate hikes.

That said, Rick Rieder, Chief Investment Officer of global fixed income at BlackRock, the world's largest asset manager, said late Monday, “The Federal Reserve may not need to raise interest rates further to fight inflation, as the fallout from last month's turmoil in the banking sector and a series of recent labor data point to a slowing US economy,” per Reuters.

On the other hand, Federal Reserve (Fed) Bank of New York President, as well as the Fed’s Vice Chairman of the rate-setting committee, John Williams anticipated slower inflation while ruling out the interest rates as culprits for the previous month’s bank fallouts.

That said, the US Dollar Index (DXY) eases to 102.55, around a one-week high, after rising in the last four consecutive days. The greenback’s gauge versus the six major currencies recently traced firmer US Treasury bond yields while cheering mostly upbeat US employment numbers. Adding strength to the US Dollar is the currency’s haven demand amid the geopolitical fears emanating from China, mainly concerning Taiwan.

Against this backdrop, Wall Street benchmarks closed mixed while the US 10-year and two-year Treasury bond yields rose to 3.41% and 4.0% at the latest.

Moving on, China’s headline inflation numbers for March, namely the Consumer Price Index (CPI) and Producer Price Index (PPI), can entertain USD/CHF pair traders but risk catalysts likely Fed bets and geopolitical concerns may gain major attention. Above all, Wednesday’s US CPI and Fed Minutes will be crucial for the pair traders to watch for clear directions.

Technical analysis

A one-month-old descending resistance line, around 0.9155 by the press time, guards immediate upside of the USD/CHF pair.