USD/CHF holds above 1.0100, supported by the 20-SMA

USD/CHF moved off daily lows during the last three hours and erased losses. The pair bottomed at 1.0099, the lowest since the European Central Bank meeting and currently it trades at 1.0125, around yesterday’s closing price. 

The pair gained upside momentum amid a recovery of the US dollar across the board. The DXY rose from 100.75 back above 101.00, into positive territory for the day. 

So far volatility has remained limited in the currency market as traders get ready for tomorrow’s FOMC decision, new macro projections and Yellen’s press conference. The Federal Reserve is likely to raise rates for the first time in a year and the second since the financial crisis. 

USD/CHF still correcting but with support 

The pair still moves with a corrective bias after Thursday and Friday’s rally. From last week peak at 1.0213, it has fallen a hundred pips. The decline so far has been capped by the 20-day moving average that stands at 1.0110. A daily close significantly below could open the doors to a more significant decline. The next strong support could be seen around 0.9950, that during most of 2016 was a key resistance.