- USD / CHF is moving lower for the second day in a row amid a sustained selling bias around the USD.
- USD bulls fail to get a respite from the continued rise in US bond yields.
- The bullish market sentiment could weigh on the safe haven CHF and help limit further losses for the pair.
The selling tone around the USD has dragged the USD / CHF pair to almost three-week lows, around the 0.8880 region, during the first half of the European session on Tuesday.
The pair has extended the modest losses of the previous day and has been under pressure for the second day in a row on Tuesday. The drop is solely due to a sustained selling bias around the US dollar, although optimistic market sentiment has weighed on demand for the safe haven Swiss franc and it could help limit the decline in the USD / CHF pair.
USD remains weak near three-week lows and fails to get respite from the continued rise in US Treasury yields. In fact, the yield on the benchmark 10-year US government bond has jumped to the highest level since February amid prospects for approval of President Joe Biden’s proposed $ 1.9 trillion stimulus package.
In the meantime, expectations for a massive US fiscal spending plan, along with progress on coronavirus vaccines, have fueled optimism about the prospects for the global economy. This, in turn, has further boosted investor confidence and continued to support the recovery in equity markets.
This appears to be the only factor preventing bears from opening aggressive positions and could offer some support for the USD / CHF pair. That said, bearish acceptance below horizontal support around the 0.8900 region may already have set the stage for a further decline amid the absence of relevant US economic releases.
USD / CHF technical levels
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