- A combination of factors does not help USD / CHF capitalize on its modest intraday rally.
- Pessimistic expectations from the Fed and falling US bond yields weigh on the dollar and put pressure on the pair.
- A softer risk tone benefits safe-haven CHF and further contributes to the pair’s selling bias.
The pair USD/CHF has failed to maintain its modest intraday gains and has fallen to fresh multi-day lows, just above the key psychological level of 0.9000, during the European session on Monday.
As investors looked past Friday’s disappointing US retail sales report, the US dollar has moved higher on the first day of a new trading week, offering some support to the USD / CHF pair. However, pessimistic Fed expectations have prevented USD bulls from opening aggressive positions and it has limited any significant rise in the pair.
Apart of this, a softer tone in equity markets has benefited the safe-haven Swiss franc and it has sparked some new selling around the USD / CHF pair. The flight to the safe haven has been seen reaffirmed by the current decline in US Treasury yields., which has been seen as another factor that has acted as a headwind for the USD.
In the meantime, the fall remains supported, at least for the moment, which warrants some caution for bears. Therefore, it will be prudent to wait for some subsequent selling below the 0.9000 level before positioning for any further bearish movement amid the absence of relevant economic releases from the US.
A sustained break below the mentioned level will set the stage for an extension of the recent sharp pullback from the 0.9470-75 region, at nine-month highs hit in April. The USD / CHF pair could accelerate the decline towards intermediate support near the 0.8940 region before finally falling to the round level of 0.8900.
USD / CHF technical levels
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