USD/CHF trades a couple of pips below parity ahead of US data

• US Dollar Index eases from multi-week highs.
• European Stocks post moderate gains on Tuesday.
• Coming up: Durable goods orders and ISM-NY Business Conditions Index from the U.S.

After closing the previous day around 40 pips higher, the USD/CHF pair stretched higher on Tuesday and touched the critical parity mark for the first time in two weeks. With market action turning subdued ahead of the NA session, the pair moving sideways in the 0.9990-1.0000 band.

The ISM Manufacturing PMI data from the U.S. yesterday offset the potential negative impact of disappointing retail sales and the Markit Manufacturing PMI readings on the greenback and allowed the US Dollar Index to push higher. Later in the session, markets will be paying close attention to durable goods orders data. Analysts expect orders to contract by 1.8% on a monthly basis in February and a better-than-expected figure could trigger a USD buying wave as it would be assessed as a fresh sign of the economic slowdown being temporary.

Meanwhile, the 10-year US T-bond yield is correcting Monday's sharp upsurge and European equity indexes are posting moderate gains, failing to provide a clue regarding the markets' risk perception today. Similarly, the S&P 500 Futures is virtually unchanged on the day, pointing out to a flat start in Wall Street.

Technical levels to consider

With a daily close above 1.0000 (psychological level/daily high), the pair could target 1.0050 (Mar. 15 high) and 1.0075 (Mar. 13 high). On the downside, supports are located at 0.9980 (20-DMA), 0.9930 (Apr. 1 low) and 0.9900 (psychological level).