USD/CHF steadies at multi-day peak past 0.8800 as traders await central bank clues

• USD/CHF remains idle at the highest level in six weeks.
• Bulls and bears struggle for clear directions amid light calendar, cautious mood.
• China-inspired optimism weigh on Swiss Franc prices but anxiety ahead of Jackson Hole event puts a floor under the price.
• China news, PMIs act as additional trading filters to watch for clear directions.

USD/CHF lacks clear momentum around 0.8820, after refreshing a six-week high to 0.8828 heading into Monday’s European session. In doing so, the Swiss Franc (CHF) pair portrays the market’s indecision ahead of the top-tier data/events.

Among them, the August month Purchasing Managers Indexes (PMIs) and China news, as well as the top-tier central bankers’ speeches at the annual Jackson Hole Symposium event, gain major attention.

That said, China’s efforts to restore market confidence and mixed concerns about the US Federal Reserve (Fed) add strength to the USD/CHF inaction as traders seek to determine the major central bankers’ take on the monetary policy measures by the top-tier central bankers. It should be noted that the policy pivot concerned weighed on the US Dollar in July before the firmer US statistics and upbeat Treasury bond yields favored the Greenback buyers.

Elsewhere, China took multiple measures, via the central bank and fiscal policies, to infuse liquidity into the markets and defend the world’s second-largest economy from slipping into recession. That said, the People’s Bank of China (PBOC), lowered the one-year Loan Prime Rate (LPR) to 3.45% from 3.55% previous and 3.40% expected.

Apart from that, the geopolitical concerns about Taiwan, Russia and the likely trade war between the Group of Seven (G7) nations and the BRICS nations including Brazil, Russia, India, China and South Africa, per the Financial Times (FT) also put a floor under the USD/CHF price. Meanwhile, the cautious mood and a lack of major data/events check the pair buyers.

Amid these plays, the S&P500 Futures print mild gains around 4,390 to extend the previous day’s rebound from the lowest level since mid-June. On the same line, the US 10-year Treasury bond yields also reverse Friday’s retreat by rising back to 4.29% at the latest.

While the central bankers are likely to entertain the USD/CHF pair traders, Friday’s Swiss employment change for the second quarter (Q2) 2023 and the US Durable Goods Orders are some extra filters toward the north to watch for clear directions.

Technical analysis

USD/CHF edges higher past the 50-DMA hurdle, now immediate support around 0.8810, to aim for a downward-sloping resistance line from early March, close to 0.8870 by the press time.