USD/CHF climbs back closer to multi-week tops, around mid-0.9900s ahead of the Fed

• Fading safe-haven demand undermined the CHF and helped regain some traction.
• A modest pickup in the USD demand remained supportive of the intraday uptick.
• The focus remains firmly on the highly anticipated FOMC monetary policy update.

The USD/CHF pair edged higher through the early European session on Wednesday and moved well within the striking distance of multi-week tops set in the previous session.
 
After the overnight intraday pullback, a combination of supporting factors helped the pair to regain some positive traction on Wednesday, with bulls making a fresh attempt to extend the momentum further beyond the very important 200-day SMA.

Improving risk sentiment/USD uptick supportive

Comments by Saudi Arabia's energy minister, saying that the kingdom has tapped inventories to restore oil supplies, helped global markets to recover from a supply shock and weighed on traditional safe-haven currencies - like the Swiss Franc.
 
This coupled with a modest pickup in the US Dollar demand, despite a sharp intraday slide in the US Treasury bond yields, provided an additional boost and remained supportive of the bid tone surrounding the major amid ranging markets.
 
It, however, remains to be seen if the pair is able to capitalize on the positive momentum or runs into some fresh supply at higher levels as investors start repositioning for Wednesday's big event risk - the highly anticipated FOMC decision.
 
The Fed is widely expected to cut interest rates by 25 bps at the conclusion of a two-day meeting this Wednesday. Meanwhile, the key focus will be on the accompanying monetary policy statement and updated economic projections/the dot-plots.
 
This will be followed by the post-meeting press conference, where comments by the Fed Chair Jerome Powell will play a key role in influencing the near-term USD price dynamics and help determine the pair's next leg of a directional move.

Technical levels to watch