USD / CHF flirts with daily lows, around 0.9100 due to renewed USD weakness

• USD / CHF struggled to capitalize on its strong rally and faced rejection near the 0.9200 mark.
• The USD cuts gains following incoming updates on the results of the US elections.

The pair USD/CHF it has now descended towards the lower end of its daily trading range, and the bears are now expecting a follow-on sell below 0.9100.

Having shown some resistance below 0.9100 earlier this Wednesday, the pair rallied over 100 pips on the day in reaction to the first results of the US presidential election. The result put an end to the hopes of the so-called “blue wave” in the US Congress and forced investors to start buying US dollars to hedge their positions.

This, together with the delay in the results of various battle states, raised the prospects for a period of greater uncertainty. The USD, however, struggled to preserve its initial gains, which, in turn, kept any further positive movement for the USD / CHF in check, instead prompting some new selling just before the 0.9200 level.

In the latest election updates, Trump’s leadership in Michigan declined significantly and is currently 49.4% versus 48.9% for Democratic candidate Joe Biden. A new turn in the tide was indicated in the last count of Wisconsin, where an estimated 89% of the vote will be reported and Biden has a modest +0.4 advantage over Trump.

Based on this, a 270-268 victory looms for Biden. This was evident by a modest rally in US equity futures, which could undermine the safe-haven Swiss franc. Added to this, the fact that Trump will certainly dispute the bottom line, the uncertain US political environment could continue to benefit the dollar and help limit deeper losses for the USD / CHF pair.