USD/CHF in search of a firm direction, stuck in a range below mid-0.9600s

The USD/CHF pair was seen consolidating overnight sharp reversal from two-week highs and seesawed between tepid gains/minor losses below mid-0.9600s.

The pair stalled its recovery move just ahead of the 0.9700 handle and came under some renewed selling pressure amid broad based US Dollar weakness in wake of the emails released by Donald Trump Jr, which revealed that he welcomed assistance from a Russian lawyer during the 2016 US Presidential election. 

With investors looking past the latest political drama from the US, positive trading sentiment around European equity markets weighed on the Swiss Franc's safe-haven appeal and helped the pair to bounce off session lows near the 0.9820 region.

However, a modest retracement in the US Treasury bond yields has failed to provide any additional boost, which eventually has led to a rangebound subdued price action through early European session on Wednesday.

Investors' focus would remain glued to the key semiannual testimony by the Fed Chair Janet Yellen, which would influence Fed rate hike expectations and provide some fresh impetus for the pair's next leg of directional move.

   •  Fed: Yellen’s testimony to be the main event of the day - SocGen

Technical levels to watch

On a sustained move back above 0.9650-55 area, the pair is likely to make a fresh attempt towards conquering the 0.9700 handle above which the up-move could further get extended towards the next major hurdle near mid-0.9700s.

Conversely, a follow through weakness below the 0.9600 handle would turn the pair vulnerable to head back towards retesting multi-month lows support near 0.9655-50 region en-route 0.9630-25 horizontal support.