USD/CHF hits highest since July, eyes 0.9460

• DXY holds above 93.00 even as US yields move off highs.
• USD/CHF heads for the highest close since July 16, 2020.

The USD/CHF rose further after the beginning of the American session and peaked at 0.9438, the highest level since mid-July. The pair is holding firm above 0.9400, about to post the strongest close in eight months.

The key upside driver in USD/CHF continues to be the US dollar and higher yields. The 10-year yield hit on Tuesday at 1.77%, a one-year high, while the DXY rose above 93.00 for the first time since November. The greenback is particularly higher versus European major currencies.

U.S. stocks are lower. The Dow Jones is dipping 0.13%, and the Nasdaq is falling 0.35%. Economic data released on Tuesday showed the Conference Board Consumer Sentiment Index climbed to the highest in a year at 109.7 in Mach, significantly above expectations of 96.9. Another report, showed home prices measured by the S&P CoreLogic Case Shiller index, rose 11.2% in January from a year ago, the highest rate since 2006.  On Friday, the Non-farm payroll report is due.

From a technical perspective, the USD/CHF bullish tone remains intact even amid some overbought readings. A correction below 0.9375 could alleviate the bullish momentum. A consolidation above 0.9430 should point to more gains. The next strong barrier is seen at 0.9460.

Technical levels