- USD / CHF encountered new offers at higher levels and was affected by a combination of factors.
- The revival in safe-haven demand benefited the CHF and put some pressure amid sustained USD sales.
- The USD remained depressed after the mixed US data, as the focus now shifts to the minutes of the FOMC meetings.
It was observed that the pair USD/CHF It was trading near the lower end of its daily trading range during the early North American session, and bears are expecting follow-up weakness below 0.9100.
The pair was unable to capitalize on its intraday rally, but instead encountered new offers near the 0.9135-40 region and was being pressured by a combination of negative factors. The sell bias around the US dollar did not diminish, which in turn was seen as one of the key factors putting pressure on the USD / CHF pair.
USD bulls found no respite and remained on the defensive following the release of mixed US economic data According to the second estimate, US GDP growth remained at an annualized pace of 33.1% during the third quarter of 2020. The reading coincided with anticipated estimates, but was slightly below market expectations for 33.2%.
On the other hand, general US durable goods orders increased 1.3% in October and orders without transportation also increased 1.3%, both beating consensus estimates. The positive figures, to a greater extent, were offset by an unexpected jump in initial weekly jobless claims and a rising US trade deficit.
Meanwhile, a softer tone around US equity futures provided a modest boost to the safe-haven Swiss franc. This was also cited as another factor behind the USD / CHF intraday retracement of around 30-35 pips. That said, downside is likely to remain limited ahead of the final minutes of the FOMC’s monetary policy meeting.
The minutes will be scrutinized closely for clues to any further easing of policy by the Fed in December amid concerns about the economic fallout from the continued rise in new coronavirus cases. This will play a key role in boosting short-term sentiment surrounding the USD and will help determine the next leg of a directional move for the USD / CHF pair.
Technical levels
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