USD/CHF extends its corrective move further below 0.9900

After breaking through 0.9900 handle and a subsequent drop below previous week lows support, the USD/CHF pair extended its near-term corrective move to currently trade at a fresh 2-week low level of 0.9860.

Since the beginning of May, when the pair dropped to a multi-month low level of 0.9444, the pair gained traction on rising prospects of a Fed rate-hike in June/July and recovered sharply to over 2-1/2 month high of 0.9956 earlier this week. Since then, the pair repeatedly failed to extend its momentum and on Wednesday decisively broke below 0.9900 handle.

Bulls seem to have turned cautious and might be willing to take some profits off the table ahead of the key monthly US jobs report on Friday, which is likely to determine the Fed's monetary policy stance during its meeting on June 15. In the meantime, today's ADP report, on US private sector employment, could provide some opportunities for short-term traders.

Technical levels to watch

From current levels, 200-day SMA near 0.9845, closely followed by 100-day SMA near 0.9825 region, seems to extend immediate support. Failure to hold these immediate moving averages support now seems to get extended below 0.9800 handle, towards 0.9780 horizontal support.

Meanwhile on the upside, the pair need to gain momentum above 0.9880-0.9900 handle immediate resistance. A follow through buying interest might lift the pair towards 0.9950 resistance, which if conquered sets the stage towards reclaiming parity mark.