Despite the investor sentiment remains subdued and risk aversion prevails, CHF fails to attract buying interest as a safe-haven currency as traders prefer the Japanese yen and gold to shield from global risks. As such, the greenback proceeds with its corrective rebound, appreciating for a seventh day in a row on Wednesday and remains in a solid short-term uptrend.
At this point, it is interesting to see if the bulls are able to bring the pair above the parity level. The risk is that traders could shift to some profit-taking around the important psychological level, citing a generally muted dollar demand in the currency markets. The negative consequences from the still ongoing US government shutdown may undermine the USD’s ability to make a major breakthrough. As such, the probability of a corrective retreat from the current levels is rather high.