CHF

A level of complacency ahead of Trump's tariffs can be seen in last week's futures market exposure, with traders increasing their short exposure to the VIX and Swiss franc, while also closing shorts against the Nasdaq at a notable pace.

Traders remained net-long US dollar index futures last week, although asset managers have the more convincing bullish view for the dollar.

Comments from SNB’s president suggest the central bank might be closer to hiking rates sooner than some expect.

The long / short ratio of bulls to bears on the Swiss franc hit a record low last week, which suggests we may be approaching a sentiment extreme for bearish positioning.

The Swissy (USD/CHF) enjoyed its most bullish day in 3-month yesterday, and just the June high stands in its way of an extended run (if consumer sentiment allows).

Whilst risk assets remained under pressure, there are signs that the risk-off tone has softened as bearish volatility remains on the low side.

The dollar’s rally leading into June’s Nonfarm payroll report saw large speculators push net-long exposure to on DXY to its highest level since June 2020.

If traders would like to trade DXY, USD/CHF may be a good substitute

US inflation data is the main data point in today’s calendar, but there was a mild risk-on tone across equity and FX markets thanks to US infrastructure bill.